Growth of China Bitcoin Mining May Help to Overcome 7/11 Halving Worries

How Bitcoin’s value will change after halving in the July 11? As many people think that mining becomes less lucrative, but some experts take a different opinion.

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Most part of Bitcoin users thinks that the halving in July will have an effect on the crypto currency’s value. Bitcoin mining activities will be less profitable because of it especially for big miners which will expand to individuals who have mining contracts. Others believe that the small miners will also suffer as well as big one.

Not long ago, there were a debate about this topic emerged in a bitcointalk.org discussion thread. So there were two particular quotations from Genesis Mining.

The first post by EBK1000 in this topic was the following:

“We know the halving will be a topic, but we cannot predict what will happen. We can’t even predict the next difficulty change due to the nature of cryptocurrency and its daily changes. But just one thought, when the mining reward will halve, also the need for BTC will increase due to expanding companies and the value of BTC will increase, and this not on minor numbers.

Best regards,

Tom, Genesis Mining”

In the next post he mention:

“If all else remains the same then mining would probably not be profitable anymore. But as said, nothing ever stays the same and effects of the (coming) halving are not known. Value can rise or drop, people can stop mining, making difficulty go down, more people could be mining it for value reasons, and so on.”

Tim Akinbo, CEO of Nigeria-based Timba Objects said that this halving is different from the previous one due to increased interest of mining bitcoins. When the first one happened most people mining Bitcoins were hobbyists but today people mining as a commercial operation with millions in investment.

He says that most mining operations are hardly gainful now and a lot of mining operations will become unprofitable, if the Bitcoin price keeps the same after the halving.

“For them to remain in business, Bitcoin’s price will have to increase by 100% for the effect to be non-existent. I don’t think that’s going to happen. When you have a barely profitable operation and then you take a 50% cut in revenue, most mining operations will shut down. That will not necessarily make Bitcoin less secure because it will lead to more decentralisation of the mining process.”

The other user believe that any loss would be undergo because of the halving.

For example, gkv9 wrote:

“Look, when the price of BTC was $200 and miners were mining, just think why did they mine… It was just because mining was profitable with the reward of BTC25 when the price was $200, so if we see it correctly, the price is currently double the previous one, and so it can be said that BTC is already priced in before halving so that miners may actually profit in future too, though they are still accumulating for any further losses which might occur but I don’t think that with this price, you might see any loss even with halved rewards…”

bitbank

The answer is lower power consumption

China’s Bitbank shares the same view. The mining company is sure that the halving will not change the industry’s long-term outlook to affect its profit at all.

The Shenzhen-based company is even trying to raise 3500 BTC via crowdfunding. They want to create a new mining factory with a promise of a 100% ROI the main idea is that the halving has been factored into the company’s business plan for over a year.

The head of international operations Virgilio Lizardo J said.

“For example, Bitbank has recently adjusted its daily unfixed and 3 months fixed interest wallet rates to prepare for the halving.”

He told that the company are planning to use ‘the world’s 14nm miners’ only. So it will give them a chance to produce an output of around 30 petahash of hashing power, with the co-operation of its sister company BW.

“The 14nm miner offers maximum performance with low power consumption and is built to have an industry leading lifetime of 24 months.”

Continue of Validation

Akinbo predict that some big miners will shut down to the July 11.

This effect may became if the price doesn’t evaluate as fast as the effect of the halving. So it will be the only time to get concerned about the halving for big miners, and may be a little bit for a regular miners. But all in all, Bitcoin transactions will be validated as long as someone has mining equipment out there.

The population and growth of the Bitcoin-mining industry in China may be a big factor for its global perspectives, and one of the indicators is the letest Bitbank’s crowdfund sale.

“We actively monitor other jurisdictions to follow the development of what works and doesn’t to help our local officials craft informed regulations in our market. Due to these factors, Bitbank is confident in the long term growth of the Bitcoin industry in China.”

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