As the price of bitcoin continues to slash, it’s mining to has nosedived with over 7% in the last 24 hours. A lot of miners are finding it extremely difficult to sustain in the mining business even though the Bitcoin price has seen a slight recovery taking it to a little more than $4000. According to a CCN report in November, the digital assets miners in China are either shutting down their rigs or redirecting them to be used in some other non-blockchain avenues that are on demand basically like video rendering and cloud computing.
A recent report of the CCN also stated that the bearish trend of the crypto market was also one of the major reasons for closing down of various cryptocurrency mining operations in Asia and Europe. Bladetech, which boasted to be the largest mining rig in the UK has also called it a day.
By the ongoing withdrawal of miners, the network is so formed to adjust itself with the difficulty level. Thus, a big transaction confirmation backlog or fees could be kept under control. With the bitcoin surging up to somewhere above $6000 seems to be highly improbable in the near future, the 7% drop in difficulty can only see a difficult readjustment pattern.
Though the Bitcoin difficulty fell from 5.8TH/second to near about 5TH /second on December 19, the Bitcoin Cash and Bitcoin SV have not moved much with just 1TH/second. This signifies that even though mining in Bitcoin has seen a downfall, it has not helped Bitcoin Cash and Bitcoin SV mining in any way.
This reveals a situation wherein the miners are just not switching from one form of cryptocurrency to other. They are actually quitting the whole mining space. It seems unlikely that there could be any problem in the normal work of bitcoin in a short period as the difficulty adjustment system will ultimately figure out that there is adequate hashpower.
If the Bitcoin slashed up price continues for a longer period, the actual problem of the current scenario could itself become a hindrance to the cryptocurrency adoption. A large market helps in regulating the Bitcoin moves to a great extent. Hence, a mass of miners refraining from their actions could affect the cryptocurrencies for security reasons. Though at present, this looks like a distant situation and a relatively upward price could make us see things differently.