Most older mining rigs will struggle to break even after Bitcoin block rewards halve in April, prompting miners to take them offline, according to research from Galaxy Digital.
As much as 20% of Bitcoin’s current hash rate could go offline after the Bitcoin halving, which will see block rewards slashed in half and leave only the most efficient mining rigs standing.
At the end of 2023, over 70% of the Bitcoin hash rate was churned out by eight ASIC miner models, Galaxy’s mining analysts said in a Feb. 14 report citing Coin Metrics data.
“Given how sensitive the breakevens are for the various ASIC models to Bitcoin price and transaction fees as a percent of rewards, we estimate that between 15 – 20% of network hash rate coming from the ASIC models […] could come offline,” the analysts wrote.
Galaxy’s prediction analyzed possible future power prices. It calculated the breakeven point for the mining rig models based on “post-halving economics,” with each mined Bitcoin block set to cut rewards from 6.25 BTC to 3.125 BTC, “transaction fees making up 15% of rewards and a Bitcoin price of $45,000.”
On the more conservative end of Galaxy’s estimates, nearly all of the older mining rigs — namely Bitmain’s S9, Canaan’s A1066 and MicroBT’s M32 models — would be shut down, while around half of MicroBT M20S and Bitmain S17 models will manage to stay online.
The five models together were responsible for around 15% of Bitcoin’s hash rate at the end of 2023.
Source: cointelegraph.com
