China Kicking Our Bootleg Bitcoin Miners
It's been nearly a year coming on the China mining ban and bitcoins great fall to $29k, many of us have forgotten about it and moved on as the miners moved to different countries and the hash rate returned to an all-time high along with the price. Bitcoin has seen a steady decline of late due to geopolitical issues, which are normally temporary, as hash rate would continue to climb.
However, in recent months, we've seen the hash rate decline and we will have the first big downward adjustment in the mining difficulty for 2022. So where is all this hash rate going, how come is going offline?
When bitcoin costs around $15 000 to mine, you're still kicking off a healthy profit in this 39 - 42k range. Anyone giving up now, must not be of their choice.
So where, what, who and how is hash rate taken offline? For an answer to that, we may have to return back to the east.
Image source: - blockchain.com
China finding hidden mining operations
Now China has been showing zero hash rate since the mining ban, but you have to be a damn fool to think that all the mining operations in China have left, no they've just moved underground or gone mobile.
One of the ways they've been able to hide is through disguising themselves as Electric Vehicle filling stations.
Reports out of China claim that local authorities have seized 1,106 mining rigs from two cities in China’s southeastern province of Guangdong.
Using EV charging points as a cover was genius, they are large consumers of electricity and allowed the miners to remain in operation for over 1,000 hours while staying hidden from authorities.
However, authorities are monitoring any electric consumption carefully, as local bills start to rise due to lack of energy supply and broken infrastructure.
The crackdown continues, as miners are confiscated in a bid to reduce the energy consumption in China, which has been a problem of late. Coupled with the fact that Bitcoin provides competition for their digital RMB, the CCP isn't going to look at bitcoin favorably anytime soon.
Bitcoin still a big part of China
China still takes up a big part of the bitcoin network accounting for 10% of global Bitcoin transactions, if you think bans and authoritarian rule are going to stop Bitcoin you're mistaken. You can see that it is able to thrive under some of the harshed conditions.
That's why bitcoin will win, and has won, it doesn't care. When you consider altcoins who have to make cosy with governments, do you really think with the way the world is fragmenting, anyone wants anything to do with American tech companies with coins?
I don't think so, they're just another layer that can get court up with sanctions and bitcoin bypasses all that bullshit.
Sources:
Have your say
What do you good people of HIVE think?
So have at it my Jessies! If you don't have something to comment, "I am a Jessie."
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You might be at least partly right. I did not know the hash rate was falling. I will have to research that. However, another possibility is that rising gas prices are driving falling hash rates.
While some bitcoin farms run on clean energy, many do not. I remember there being a big hullaballoo locally when someone was running a small bitcoin farm on their acreage in a fairly wealthy area.
Their neighbours were upset because the gas generator was so loud. The latter is what makes me think of the gas prices possibly driving down the hash rate. You mentioned that it was still profitable to mine, but that depends on where you live and how electricity is provided.
Particularly since the gas price increase may be viewed by many as temporary, I could imagine that they might slow down or halt their operations until the situation becomes more favourable.
However, maybe it's something else.
!PIZZA
The average cost to mine one bitcoin is around 15k USD in energy cost, at the current price you still have a massive margin. Also most big miners are well capitalised that they don't even need to sell their bitcoin to cover costs as well as these companies using futures to smooth out their energy cost, I don't see how gas prices or energy prices would really cause a substantial amount to go offline
It's normally down to things like political instability, which we've seen in China as I mentioned here and in Kazakstan where a few million
I am not discounting your idea, I just don't think it would have that big an effect the way its currently set up around the world. Garage miners and home miners most of them accept that their cost to capital won't be near term so why would they shut off at a price rise in energy short of them not being able to cover their costs?
You may be right. It was just a thought. Alarmed at high pump prices, they might freeze spending on gas.
I have been part of corporations that did things that seemed crazy -- like freezing spending periodically on things like stationery. I remember saying to my manager, "So, when we need more paper, what would you like for us to do?" Since it was a large corporation, we literally resorted to becoming thieves -- sneaking into other departments and pilfering their office supplies so that we could do our jobs! Ha!
It was this type of experience at several blue chip corporations that led me to think corporations are slightly unbalanced, and that expecting precise logic from them is not sensible. That is why, according to corporate logic, if the pump price is high, turn off the electricity makes weird sense. It is locally cost saving, but not sensible in the long run.
However, I could be wrong. I have a lot of ideas, and most of the time? They are sadly mistaken. I have come to accept that as a fact of life.
!BEER
thanks so much for that story, its sad but also brilliant, as an indication of how the fiat system works, and how bullshit the jobs are, I remember working in corporates where I would create reports, only to be asked to recreate them and then they never even were used for anything, maybe a power point slide once in a while and I spent hours on them for no reason other than the manager wanted it lol
And I wasn't even in the biggest corps am sure in larger ones in US, EU and China are far worse with this wasting of peoples time and resources just to keep the illusion of work going
Lol absolutely I have been more wrong than ive been right, but I still enjoy putting my ideas out there and seeing what people say so I can learn from others
That is literally the reason I quit the last lucrative job I had. They were paying me a lot, but driving me insane. I was a unix systems administrator. They paid me and four other contractors beaucoup $$$ to configure some medium scale servers. The specifications they gave us were bad. By bad, I mean they forced us to over-ride the systems' built-in redundancy, so, in case of failure, they truly would fail. We worked tirelessly, putting in overtime to build the systems. The next day (I kid you not), the systems were taken to other departments to be repurposed and reconfigured. They did this twice more. I was astounded. In retrospect, clearly, they needed to keep the funds going and we were simply spinning our wheels. However, when they offered to renew my contract again, I quit and took a job for a third the pay that didn't drive me crazy.
That job made me seriously ask myself the question, "What price is my sanity worth?"
Ahh... corporations. Ironically, they always seemed to like me. I just felt like a square peg jammed hard into a round hole.
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Only the rich people can afford it to mine. Haha. 😂
But seriously. Nowadays my total monthly income is approximately $470 USD per month, while the local minimum wage is approximately $550 USD per month, and many people live (survive) on less.
Fuck the traditional monetary system, but fuck Bitcoin (BTC) too. Fuck financial (and any/every other kind of) discrimination.
This is my (not so popular) opinion.
Have a nice day and have a nice weekend.
All the best. Greetings and much love from Hungary.
Well thats if you want to mine A WHOLE Bitcoin, which isn't practical anymore as is buying a whole bitcoin, who the hell has $41k to buy 1 lol, I know I dont.
You can still mine portions of a bitcoin and keep it off the books so to speak since you don't have to KYC for that, you just converting electricity to money. Some people even mine at a loss now because they feel those sats will appreciate past what they spend now.
Wow, $550? Is that tax-free? Because in South Africa, that would be below the income tax bracket, but yes I would totally agree its not enough to live on even here, well you can live, just not the most glamorous of lives. You'd be sharing a residence, and so on
I personally side with Bitcoin because the rules are harsh for everyone, no can can get a leg up, yes others can use their advantage in the fiat game to move into bitcoin but very few do that
This is the official minimum wage, but most people do not receive it. Me neither. My total income is approximately only $470 USD per month. This consist of a low (approximately $250 USD per month) pension-like income for my multiple disabilities, and the salary of my four hours per day packaging part time job.
The result of this is the fact that financially I cannot afford the rent on my own in the winter (because of heating expenses).
Hive will be joining this party as well at some point. Decentralization and privacy are going to be key components of the coins/tokens that survive the crackdowns and regulations that are coming at some point. It's only a matter of time.
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I honestly don't see it, HIVE is terrible for privacy and most Hive users have doxxed themselves so it leaves the network open to attack from centralised liquidity providers like exchanges