Bitcoin mining is more profitable in the 30 days ended November 2020, but it is not only the intense high of the leading cryptocurrency that weighs. Although this is a relevant factor, you can’t dismiss the end of the rainy season and the equipment price, explains Bernardo Schucman, CEO of FastBlock.
According to the CEO of the blockchain management and consulting firm, the rainy season’s end raised the price of energy. Besides, it caused about 25% of the bitcoin mining network to be shut down. Consequently, “the network was slower than normal, an element that raised bitcoin’s mining rates”, he said.
The recent rise in the bitcoin price has also helped make mining more profitable. In mid-November, the rate of the leading cryptocurrency almost reached R$ 100 thousand. The value is much higher than the R$ 39 thousand from January. Meanwhile, its market capitalization has set a new record: US$ 330 billion.
Bitcoin’s more profitable mining generates high equipment prices
Thus, bitcoin mining became 50% more profitable than in September this year, according to FastBlock. And sector’s data mentioned by the consultancy indicate that mining performance compared to business investment was between 5% and 15%.
Also, according to the statement, this whole scenario contributed to making mining equipment more expensive. Therefore, this elevation should also be reflected in a new mining value.
“The race for mining equipment grew a lot and caused a great difficulty in acquiring new equipment”, explained Schucman.
Cryptocurrencies confirmed the forecast at the beginning of the year and proved resilient even amid the pandemic. The substantial rise of bitcoin shows this. And it was not just the bitcoin that attracted investors. It is worth remembering that factors such as the success of DeFi (decentralized finance) generated a high volume of operations at Ethereum. Thus, the reward to the miners also increased. Consequently, operations became more expensive.