ASIC Miners and Mining Rigs Go Dark as Crypto Markets and Cryptocoin Mining Crashes
One year ago, basements were being converted into mining farms as electricians and heating/cooling experts were brought in to upgrade electricity, install duct work and fans to power up and cool off mining farms. Reddit and Facebook groups were loaded with pictures and videos of homebrew mining rigs as the price of graphics cards skyrocketed and became scarce. Gamers complained. Retailers began limiting order quantities. Cryptocoin mining crashes? Unthinkable at the time.
Bitcoin mining was worse. ASIC mining manufacturers Bitmain and Canaan couldn’t make them fast enough. When a batch went on sale they were sold out in minutes and at top dollar. Today, Bitcoin miners are readily available with more power and efficiency than ever at a fraction of price. Nvidia is facing pain from a sudden plunge in demand too.
The after-effects of cryptocoin mining crashes.
The laws of supply and demand are in full force. With the recent crashes across all cryptocoin markets, existing mining operations are going dark and nobody is thinking about starting one or expanding.
Watch the stats on Slushpool and the story tells itself; hashpower is dropping on a daily basis as thousands of workers go dark after miners hit the OFF switch. Who can blame them? Run the numbers on any crypto mining calculator and see how much money you’ll lose mining crypto on an HOURLY basis.
We documented a cryptocurrency mining downturn back in August but could never dream that just three months later, the entire mining ecosystem would face collapse. This is worrisome for the entire cryptocurrency sector because miners keep everything moving; Bitcoin miners not only mine new Bitcoin; they process all of the transactions on the blockchain. This extends to all of the other digital currencies out there; without miners doing what they do, things can grind to a standstill.
While cryptocoin mining crashes do not bode well, it is too early for anyone to predict future market moves one way or the other.