While 2019 has had a few narratives in regards to the cryptocurrency industry – from Crypto Spring to the year of enterprise adoption. One narrative underlying all of this has been the Bitcoin mining hash rate.
Bitcoin’s mining hash rate has been tearing away through the entirety of 2019. Huge milestones were crossed, and impressive numbers were put up. The 17th million, and 18th million coins have been minted this year – a year that leads up to the reward halving in 2020.
More so, the difficulty level of the mining algorithm has not dropped more than a mere 1.18 percent, indicating that not much is slowing down the miners.
Many theories have been thrown at this phenomenal year-long drive of big mining on the Bitcoin blockchain, but it may simply be down to better and better hardware. The Daily Chain sat down with Alejandro De La Torre, the Vice President of Poolin, one of the largest mining pools in the world, to discuss the state of the mining ecosystem today.
“The mining hashrate being on the rise has a lot to do with the new generation of mining equipment,” De la Torre explained. “Basically every single mining manufacturer has already sold out all their new patches so a lot of mining operators have received their new machines and they have switched over from the old generation to the new generation.
“These machines are up to 4 times stronger than the S9s, so you are talking about some serious hash power for a low amount of electricity usage.”
This is a solid theory from the man who also helped set up the BTC.com mining pool, and also answers questions as to why there has been hardly any effect in mining hash rate tied to the price of the ever-fluctuating cryptocurrency.
The next question is whether or not this new generation of mining equipment is for the betterment of Bitcoin, or if it will have an effect on the decentralized nature of the coin.
“One must keep in mind that stronger hashrate equals stronger security of the network, so it is good that the new hardware is out and doing its thing,” said De la Torre. “From my experience, from what I have seen in the last two years, and especially the last year, is that most mining farms are now done by professionals and teams that really know what they are doing with experience in setting up data centers or setting up big operations.”
One knock-on effect from this new generation, which actually could play its part in helping the decentralization of the blockchain, is that the older generation of S9s and the likes should soon be flooding the market at greatly reduced prices.
“Also, the new hardware, and the halving that is coming up will make a lot of the old generation of miners obsolete,” explained the mining mogul. “We will see an influx, an insane amount of S9s and that generation, flooding the markets.
“I am already seeing them being sold to areas of the world where electricity is cheap – Venezuela and Iran – so we are going to see these old S9s and that generation of miners will either be made obsolete or could be useful in areas where they are needed.”
“That will be interesting to see how the mining ecosystem develops in the next few months with this change over in generation of hardware,” he added.
Indeed, not only will these miners permeate areas where Bitocin can help a lot of people, they will still be viable enough for smaller operations and individuals to be apart of the Bitcoin network. This helps the people, but also the decentralization of Bitcoin, and its general network security.