UNITED STATES (OBSERVATORY) – Analysts from Morgan Stanley came to the conclusion that in the case of the inability of bitcoin to recover to $ 8,600, the miners are likely to find it unfavorable to continue further mining, CNBC reports.
“The break-even point for major mining pools is $ 8,600, even taking into account low energy costs ($ 0.03 per kWh),” analyst Charlie Chan notes. “Therefore, we believe that the price for mining equipment bitcoin will further decrease, affecting the demand for chips from TSMC,” Morgan Stanley reported.
On Thursday, Taiwanese semiconductor manufacturing company Taiwan Semiconductor Manufacturing (TSMC) lowered its quotes for profitability in 2018 due to the uncertainty of demand for cryptomayning.
In addition, experts note that the development of the mining industry and the release of more powerful equipment do not solve the problem, as the growth of the global network hash grows and the complexity of mining increases. Even at the most basic level, the production of bitcoins requires expensive and energy-intensive computer equipment.
The technological requirements for the production of bitcoins are now quite high and become even higher thanks to the “computer arms race”. Recall that the required number of zeros at the beginning of hashing changes every two weeks to correct the complexity of creating the block: more zeros mean more difficulties.
The bitcoin algorithm adds these zeros to keep the level at which blocks are constantly added, one new block every 10 minutes. The idea is to compensate for the cost of equipment for bitcoin mining, which is becoming more and more powerful. When hashing is more complex, more effort is required to create the block, and therefore more effort is needed to obtain new bitcoins, which then go into circulation.
In this regard, for stable profitability of mining, the rate of crypto currency must constantly grow, and even if bitcoin will be steadily trading at the same levels, the profit from mining will continue to fall.
“The new mining capacities will increase the difficulty of mining in the second half of the year, but even at a fixed price of bitcoin in 2018, the profit from mining will drop rapidly,” Morgan Stanley analysts said.
Companies that sell specialized equipment like ASICs, according to analysts at Morgan Stanley, will receive more revenue for another two years, even if the bitcoin drops to $ 5,000.
At the moment, bullish is dominated by bitcoins. The daily growth was 3.47%. Market capitalization was $ 144.68 billion. The cost of one BTC token is $ 8,516.19.
The crypto-currency market at the time of writing is in an uptrend. All without exception, crypto-currencies from the top ten are growing. The total market capitalization of the current currency has reached $ 373.87 billion according to the data of Coinmarketcap. The index of dominance of bitcoin is 38.7%.