- The Antminer S9 is set to pave the way for more productive and energy efficient devices for mining Bitcoin
- Bitcoin behaves in a fashion similar to the OPEC cartel in the oil industry
According to an article published on Nov. 26, 2018, Bitcoin (BTC) and the famous OPEC cartel seem to share a lot of similarities than previously thought off. It was noted that factors are resetting the price of “mining breakeven” to be between $3,900 and $4,400 for many miners (at least 70%).
Recently the price of Bitcoin (BTC) crashed to almost $ 3,600, equivalent to its lowest price for thirteen months since September 2017.
A good number of investors were surprised and expected the price of BTC to hold close to the market 6,000 dollars, which has long been considered an exclusive price barrier: the breakeven price of mining Bitcoin itself.
Although this was empty halfway through 2018, data no longer shows this assumption for the most prominent mining pools. Instead, a combination of factors restores the “mining breakeven” price for the vast majority of miners (at least 70%, and especially in China) between $ 3,900 and $ 4,400.
Despite an expectation of a higher breakeven, Bitcoin hits close to $ 4000
It is always interpreted that the Bitcoin pricing is congruently driven by the biggest miners, akin to OPEC’s influence on the oil market, in an oligopoly structure. The latest decline in prices reflects the possible choice of China’s largest mining basins to exploit its relatively low production costs – cheaply priced wholesale energy and mining equipment at a cost – to achieve maximum returns and broader strategic goals.
The Antminer S9 set to pave the way for more productive and energy efficient devices
Today, however, Antminer S9 is heading out (commonly available in the $ 300 market), which will soon be replaced by more productive (faster processing and more energy efficient) ASIC devices. As a point of reference, experts ran the price analysis and breakeven estimates using the new Bitmain Antminer S15 and T15 announced in November 2018. This is expected to be the dominant ASIC used by miners in the next 12 -18 to months.
What could lead to the current trend in the dip in prices?
Many discussions point to fear of the Bitcoin Cash (BCH) fork in progress, which is indeed on point. BCH is itself well-insulated from BTC and the broader market is not responsible for the bitter sentiment on board (the witness Ripples XRP is relatively stable during the same period).
Others point to the latest SEC actions in the US against ICO issuers, whereby their encryption currencies are reclassified as true securities. But again, it is a long-standing known concern that has probably been priced, coupled with the fact that Bitcoin is a real global currency. Therefore, the US effect seems to be an unlikely dominant factor (anecdotal we have observed major price movements in the past week, as regularly occurs during Asian trading times/overnight in the US).
