Bitcoin mining profits up 35% and sustainable energy use up 56% in the second quarter

Analysts are now predicting that bitcoin mining profits will increase by around 35% in the short term due to the impact of the bitcoin mining crackdown in China. Since the crackdown, a significant portion of the Bitcoin network’s hashrate has disappeared. Miners struggle to move and some may not even be able to move due to complex logistics. All of these reasons combined could be a great time for new businesses to get into mining.

Bitcoin mining profitability will increase in the short term

Due to the complicated situation miners are facing in China, it is expected that the profitability of Bitcoin mining will increase in the short term. According to Whit Gibbs, CEO and founder of Compass, this will continue in the short to medium term. Gibbs talk to CNBC:

“We expect a much more profitable mining period for Compass Mining customers. We assume that the miners will be around 35% more profitable. “

Compass is a Bitcoin mining company that started offering services this year after receiving $ 1.7 million in a seed round last February. The mining exodus is likely to benefit suppliers and startups like you in the future. Other analysts agree. Darin Feinstein, the founder of Blockcap, a giant North American mining company, said:

“We expect to increase sales and profits in the near future. This is an unexpected gift to the network, not only in terms of revenue, but also in terms of decentralization and sustainable energy metrics. “

Bitcoin was just experiencing one of the biggest troubles in history (-27.94%). This means that most miners will reap more rewards in the short term. This mechanism is in place to keep Bitcoin afloat in the face of hashrate swings like last month.

Analysts and mining company leaders estimate that this boost phase could last up to 15 months. Bitcoin mining is not a simple process and it is not possible to simply move the necessary hardware along the border. The development of the logistics industry for Bitcoin mining takes months or even years. Some may not even move and choose to close the mining business for fear of retaliation in China.

Such is the case with Liu Hongfei, a Chinese bitcoin miner. Hongfei talk to Reuters:

“If the government doesn’t allow it, I’ll have to stop working.”

While the situation is difficult for miners in the country, the Exodus is opening up new opportunities for entrepreneurs around the world.

56% sustainable energy in the second quarter

For the past 3 months, there has been a significant focus on the impact of Bitcoin mining on the global environment. While many people claim that Bitcoin mining is bad for the environment and many others insist that it has a positive effect on the environment, most rely on old and unreliable data from a few years ago. On July 1, 2021, the recently formed Bitcoin Mining Council (BMC) announced report confirm 56% hashrate when using sustainable energy sources.

Bitcoiners hope Elon Musk learns that half of the hashrate is using sustainable energy to mine Bitcoin. BMC released the report shortly after online posts surfaced about Elon Musk’s change of mind.

“Tesla says they won’t accept BTC again until energy usage reaches 50% from renewable sources,” says a Redditor said “Now that BTC uses 56% renewable energy, I wonder if Tesla will accept BTC again anytime soon?”

The post “Tesla Accepts Bitcoin Again” on Reddit r / bitcoin received over 5,700 upvotes.

Energy consumption of the global bitcoin mining industry and countries.

The BMC report states that in its first voluntary survey, the organization collected information on sustainable energy miners from “more than 32% of the current global Bitcoin network”. The results of the survey show that BMC members consume electricity “with 67% of the sustainable electricity mix”.

“Based on this data, it is estimated that the sustainable electricity mix of the global mining industry grew by around 56% in the second quarter of 2021, making it one of the most sustainable in the world.”

This data is very different from the Coinshares report published over 3 years ago and unreliable data from the Cambridge Bitcoin Electricity Consumption Index (CBECI) and digiconomist.net. Both Digiconomist and Cambridge data show significant differences between estimates of electricity usage, and both have mining maps that have not been updated since April 2020.

Microstrategy and CEO Michael Saylor, member and founder of BMC, was satisfied with the results.

“I am pleased to see that the Bitcoin mining industry has voluntarily provided vital information to the public and policy makers, particularly in relation to clarifying common misconceptions about the nature and extent of Bitcoin energy use. This survey – the first quarterly publication we expect – is based on data from miners around the world. As I said, just because the Bitcoin network is decentralized doesn’t mean it is disorganized.

A BMC spokesman for Saylor also released one Video records some of the data found in the global mining report.

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