Bitcoin, the world’s largest cryptocurrency by volume, continues to struggle above the $7,000 level. After dropping to $300 billion on Monday, the total market value of all cryptocurrencies has rebounded and is now at $320 billion according to data from CoinMarketCap.
ARE MINERS IN TROUBLE?
Since the overall price remains on a downtrend, one important part of the bitcoin industry is changing, and it could have an even bigger impact should prices continue to go down.
“Historically, miners have been true believers and supporters of bitcoin and other cryptocurrencies—choosing to take profits in manageable chunks or holding off on selling coins to support prices,” Thejas Nalval, portfolio director, and Kevin Lu, director of quantitative research, at Element Asset Management said.
“However, the world of mining has changed from one made up of evangelists to one where large-scale facilities reign, making fluctuations in price more deadly,” they added.
The people at Element Asset Management reckon that break-even levels for mining bitcoin run from $6,000 to $8,600, which means prices are approaching levels where miners may have to sell their holdings in order to sustain operations.
A report from Elite Fixtures allege that the cost to mine a single bitcoin in the United States is around $4,758, in Japan $8,723 and in South Korea $26,170.