TL; DR
Full story
Hot take: the Bitcoin halving is not necessarily good for everyone.
Actually, there are some significant potential downsides for miners.
Let’s dive in, shall we?
This coming April will be the next halving cycle for Bitcoin – aka BTC mining rewards will be halved.
Generally (at least every previous time) the price of Bitcoin briefly skyrockets, so people expect BTC to do the same this time.
But! The main job of a miner is to solve complex cryptographic puzzles over and over again.
Cool.
But to do that, miners use a LOT of electricity… so much electricity that many mining groups are finding it difficult to remain profitable at current electricity rates with current block reward prices.
Are you starting to see the bigger picture?
When Bitcoin halves, miners will be rewarded half of what they used to get – all for the same electricity costs as before.
Margins are pushed even closer to breakeven, or possibly even into negative territory.
And some major industry players are even warning investors that this upcoming halving will most likely see a lot of mining machines shut down.
That means miners may have to get creative.
