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So big that the hype of 2017, and the crash so mbadive only a year later: the cryptographic currencies have experienced a disaster in recent weeks. The sale continues unabated Tuesday, weighed down by reports that now the mining community is drawing the consequences.
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The miners put an end to their commitment
The continuing decline in cryptographic currencies is also affecting Bitcoin & Co. miners. Some farms – particularly in Asia – have already ceased operations, while others have significantly reduced their mining activities. The reason is simple: the constantly decreasing price of crypto-currencies makes the extraction unprofitable for many users. Since the beginning of November, nearly 800,000 devices are online, reports "CoinDesk", which relies on information provided by Mao Shixing, co-founder and CEO of F2Pool, the sixth largest mining pool in the world.
The experts of the American bank JPMorgan meanwhile declared that it was not worth looking for new digital tokens. Already, after the Bitcoins had exceeded the threshold of $ 6,000, he said in a statement from the financial house: The decline below this threshold suggests that the level of mining of some miners is no longer profitable.
Because the operating costs of crypto-currencies are enormous: in addition to the enormous costs of energy, it is also the technical equipment that must first be profitable. Last year, at a price of $ 20,000 for a bitcoin, the trade was worth it. Meanwhile, the price of a bitcoin is still well below the targeted profitability of JPMorgan. – the lowest of the previous year.
Bitcoin not taxed as a means of payment
But the fall in prices does not only concern mining activities. There are also signs of decreasing the use of Bitcoin as a means of payment. According to a Chainbadysis study, the business figure made by payment processors such as BitPay when processing Bitcoin payments by merchants dropped by about 80% between September 2017 and September 2018.
Bitcoin does not have, contrary to what many investors and supporters hoped, a payment method on the market. Experts have repeatedly stressed the scalability of digital currency. In addition, when prices rose in 2017, the crypto market was already riddled with many speculators, who were only looking for price gains, but not the active use of Bitcoin as a means of payment.
Investors are fleeing in droves
Investors in the cryptography market seem more and more panicked. That the soil of Bitcoin & Co. is already found is at least debatable. Because the general environment of cryptocurrencies remains degraded. Not only the concern about Bitcoin's split Bitcoin, but also a lot of uncertainty in the market, push investors to withdraw their capital in bulk. Even the hopes then not realized for a Bitcoin ETF seem more and more offensive to the market participants.
Overall, the outlook is not good for the cryptography market in general and that of bitcoin in particular.
Editors finanzen.net
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