While the price is stuck, despite its correlation with S&P 500 at all-time highs and the equities market having a winning streak, the network is growing.
Bitcoin miners are using a record amount of computing hash power to solve the next block to gain a 6.25 BTC reward.
The 7-day average hash rate has hit an all-time again of 123 Eth/s amidst the dull market.
“BTC security is looking healthy, with hash rate and mining revenue both increasing. Hash rate grew by 6.6% week-over-week and should soon pass pre-halving levels,” noted Coin Metrics.
Miners remain as bullish on bitcoin price as ever given that they continue to put in resources despite the block subsidy in May.
As we reported, the 50% cut down in block rewards, from 12.5 BTC to 6.25 BTC in May, has the miner revenue falling by 23% in June.
However, the traction count has started to uptrend after the March drop, as per Coin Metrics. We are gradually making our way to 350k transactions a day, to the July 2019 level, so it's a good thing if it maintains the uptrend.
Last month, the fees paid on every transaction accounted for only 4.3% of monthly revenue at $12 million, down from the 12-month high of 8.3% in May.
For now, bitcoin miners can mine at a low cost because of the rainy season in China. But when it comes to an end in October, it could hit miners if the price doesn’t rise.
Another factor that will affect the profitability of miners is the new generation mining machines that are being ordered in bulk.
Hive Blockchain technologies are the latest one to order 200 Bitmain Antminer S17e 60 terahash per second (TH/s) SHA 256 mining machines for under $0.2 million, to scale up its bitcoin mining operation in Quebec.
But these aren’t delivered yet. Not only could they take time, the ongoing struggle between the two co-founders of Bitmain, the world's largest bitcoin miner maker, further puts the delivery of these miners in jeopardy.
According to the latest reports, Micree Zhan is changing the miner sales payment bank account, but reportedly the other co-founder Jihan Wu has refused the deal, and this could continue for a while.
This marks the DEATH of Jihan in the Bitmain power struggle IMO:
Bitmain just announced it will change the miner sales payment bank account & wiring info into a company Micree serving as legal representative
These new machines are necessary for miners because the difficulty of producing more BTC is expected to continue to rise.
During the past halvings, bitcoin difficulty kept on going, and according to analyst PlanB, it will follow suit this time as well.
Bitcoin difficulty before and after 2012, 2016 and 2020 halving. I expect it to keep going up from here, maybe slightly less than the dark blue post 2016 line, at ~2-3X/yr. pic.twitter.com/a6hqxo4zav
In a previous post, the analyst had also shared that “bitcoin bull market seems to start at difficulty bottoms.”