Bitcoin ‘Halving’ Will Deal a $10 Billion Blow to Crypto Miners
In a few days only, the halving will cut the amount of Bitcoin that “miners” can earn each day for validating transactions to 450 from 900 now.
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Bitcoin halving, a once-every-four-years software update called the “halving” has long been held as one of the keys to propping up its value. Halving is due to take place next week#BitcoinHalving #BTC减半 pic.twitter.com/4lU8Vj8nkJ
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For enthusiasts of Bitcoin, a once-every-four-years software update called the “halving” has long been held as one of the keys to propping up its value.
Cryptocurrency’s update will slash new supply in late April
This time around, it’s also set to trigger multibillion-dollar declines in revenue for the very companies that ensure the digital currency’s smooth functioning, right on the heels of a surge in their biggest costs.
Based on Bitcoin’s current price, it could spell revenue losses of around $10 billion a year for the industry as a whole. Marathon Digital Holdings Inc., CleanSpark Inc. and other miners, which compete for a fixed Bitcoin reward by solving mathematical puzzles using superfast computers, have invested in new equipment and sought to buy smaller rivals in an attempt to cushion the drop-off in revenue.
“This is the final push for miners to squeeze out as much revenue as they can before their production takes a big hit,” said Matthew Kimmell, a digital asset analyst at CoinShares. “With revenues across the board decreasing overnight, the strategic response of each miner, and how they adapt, could well determine who comes out ahead and who gets left behind.”
