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Bitcoin saw one of the most significant sell-offs of the year, dropping 29% from a high of $32,000 earlier this week down to $20,862 Monday evening. Panic – seeded by crypto-lending platform Celsius halting
withdrawals Sunday evening US-time, followed by Binance temporarily halting withdrawals from a claimed
“stuck transactions” – is certainly gripping crypto markets.
At the same time, traditional finance is having issues of its own. The S&P 500 is down almost 10% after the weekend while most stocks sank into the red. Larger market sell offs are certainly causing panic in Bitcoin, cascading from equites all the way down to
Celsius.
Miners are not spared. The cost-to-mine has become slightly more expensive as of the most recent 1.3% upward difficulty adjustment on June 7. Bitcoin’s difficulty is now over 30.3 Trillion (T).
Combine high difficulty with a sudden drop in BTC price, and miners may be shutting off their machines. In fact, we can see as much on-chain. Block times intervals increase pass the ten minute target if the network’s difficulty is too high. Currently, the
average block time as of Monday is some 970 seconds, according to Blockchair. Block times usually clock in around 600 seconds and could revert to normal, depending on network conditions.
The large increase in block intervals indicates some miners – likely less efficient miners running older generation Antminers and Whatsminers – are dropping off the network. Luckily for next generation machines such as the Antminer S19, there’s
still cushion for revenue positive mining, particularly if your hosting situation has low energy costs.
-Mitch Klee
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