Bitcoin prices are still extremely volatile and, as we saw at the weekend, experience wild swings in both directions. This trend is likely to continue until distribution evens out and is not as ‘top heavy’. BTC mining, on the other hand, has had a much smoother ride in recent years.
Cumulative Bitcoin Mining Revenue Tops $16 Billion
The epic bull run of 2017 created a number of major changes to the crypto landscape. Before then very few people had knowledge of bitcoin, and even fewer on all of the altcoins out there. Within three months, prices of all major crypto assets had tripled and were still climbing. The moon and Lambo culture was cranking and a number of people made a lot of money.
Then came the inevitable downturn and with it tumbling prices and rafts of regulations. Bitcoin collapsed 84% in a single year to end it on the floor below $4,000. A number of BTC miners were forced to power down their rigs which resulted in a drop in hash power and difficulty.
Cumulatively, however, revenue has continued to climb for miners and now totals an equivalent of around $16 billion in block rewards. Senior Research Analyst Elias Simos has been looking into the figures and noticed an inflection point in late 2017.
So far, $BTC miners have been allocated the equivalent of $16B, since early-2013. In the 4 years pre-ATH, miners made 2.5x less the amount they did in the ~2 years after. Looks like the 2017 top was a real inflexion point.
So far, $BTC miners have been allocated the equivalent of $16B, since early-2013.
In the 4 years pre-ATH, miners made 2.5x less the amount they did in the ~2 years after.
Looks like the 2017 top was a real inflexion point. pic.twitter.com/9q0eaZiiNm
— Elias Simos (@eliasimos) October 28, 2019
Even though prices fell throughout 2018, the cumulative mining revenue continued to climb. Aside from a dip in late 2018 during the depths of crypto winter, the hash rate has done exactly the same. This would imply that very few miners actually shut off their rigs and hodled through the dip with high confidence that prices would return the following year, which they did.
The gamble paid off and now BTC is trading over 190% higher than it was during the 2018 low.
Mining Giant Files For US IPO
In a related development, bitcoin mining hardware giant Canaan has filed for an initial public offering in the US. According to Bloomberg the world’s second-largest mining rig manufacturer listed its offering size as $400 million when it filed with the Securities and Exchange Commission yesterday.
The Hangzhou, China-based company attempted a Hong Kong listing last year but pulled out as the bear market deepened. Rival firm Bitmain, the world-leader in bitcoin mining hardware which recently unveiled a new US facility, is also considering a US IPO indicating that it still is a very lucrative business.
Will bitcoin miners continue to reap the rewards after the halving? Add your thoughts below!
Images via Bitcoinist Media Library, Twitter: @eliasimos
The post Why Bitcoin Mining is Still a Very Lucrative Venture appeared first on Bitcoinist.com.
by Martin Young via Bitcoinist.com
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