Bitcoin SV and Bitcoin Cash mining process is proving to be far from profitable
Mining plays an essential role in the ecosystem of Proof-of-Work (PoW) algorithms. It is a productive activity, helping to operate the network and bring money to investors. However, it is the story of Bitcoin or other cryptocurrencies. That’s not what’s happening with Bitcoin SV (BSV) and Bitcoin Cash (BCH); this simple process is proving unprofitable.
BSV and Bitcoin Cash mining: Low cost, non-lucrative block rewards
Bitcoin SV and Bitcoin Cash are two hard forks from the original chain, Bitcoin (BTC). Both chains boast much cheaper deals, meager additional fees for miners. Even for the Bitcoin chain, fees still fluctuate around $ 200,000 per day, a fraction of the block reward.
BCash & SV miners have made <$300 of combined fees over the past 24 hours. After their halvings, new issuance will be cut from a combined $600K to $300K.
Miners are already “irrationally” mining these chains at a loss (h/t @BinanceResearch).
Both halvings will occur before $BTC
— Ceteris Paribus (@ceterispar1bus) January 9, 2020
But the results were even worse for BSV and Bitcoin Cash mining. Moreover, miners on these networks need to provide high-capacity, highly specialized hardware. The reason is that chains try to distribute larger blocks, putting more stress on the tapping tools and nodes.
In addition to absorbing hardware costs, networks are also not profitable enough, with mining companies operating below breakeven. Also, BSV mining companies are under pressure to hold block rewards, as the sale will reduce the price of assets. Block production, in many cases since the August 2017 hard fork, has relied on an unspecified mining tool. This exploit is suspected as Bitmain.
For BSV, nearly 50% of the blocks also moved to an unknown Google mining tool. This makes the community suspicious of which entities are supporting the chain with only a small advantage to exploit other chains.
The price of Bitcoin SV and Bitcoin Cash is nothing special
Add to that the relatively depressed market prices of BCH and BSV. After the recent slide, BCH returned around $ 236.28. BSV trades at $ 116.47. So far, the coins have held new gains since the beginning of 2020. But their prices are still falling significantly compared to prices close to the November 2018 hard fork.
The reason behind this nonprofit mining is unknown. There may be hope for a future price increase. Both projects have a high-voice community, claiming that their money outperforms Bitcoin, thanks to larger blocks and lower fees.
And both projects have been discredited by the touch of Dr. Craig S. Wright, the most notorious Satoshi Nakamoto book lover, on separate occasions, claiming both BCH and BSV are real Bitcoin.
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