Since the inception of Bitcoin, mining has become very profitable because it is a way to earn passively. Mining is the foundation of Proof of Work (PoW) cryptocurrencies. One cryptocurrency that allows mining is Ergo. That Ergo coin is worth $3.02 at the ...

How to Mine Ergo 2022 (Complete Guide)

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Key Takeaways The crypto market has seen a remarkable surge in Q4, with Bitcoin’s price rising over 25%, and the total market capitalization reaching $1.3 trillion, in contrast to Q3’s stagnation. Market Overview: Trading activity on the top 10 crypto exchanges dropped by 23% in Q3, with trading volumes totaling $6.1 trillion, down from $8.3 trillion in Q2. Binance, in particular, saw its market share plummet to 44% due to legal challenges. Trading Volume Declined in Q3: Bitcoin’s dominance increased to 51% by the end of Q3, up from 46% in Q2 2023 as excitement builds up on the possibility of a Bitcoin Spot EFT launching in the U.S as early as 2024. BTC Dominance and ETF Anticipation: Layer 1 blockchains saw a 2% decrease in active users, while Layer 2 chains experienced an 18% growth. Base, an Ethereum Layer 2 solution, emerged as a significant player, handling a peak of 1.8 million daily transactions. Layer 1 and Layer 2 Dynamics: The crypto VC market faced headwinds in Q3, with only $1.975 billion invested in the crypto and blockchain sector, marking a new low since Q4 2020. Crypto VC Funding: Q3 2023 witnessed several major security breaches; Mixin Network suffered the largest breach with around $200 million compromised. Other notable hacks were Multichain, CoinEx, Curve Finance and Alphapo. Crypto Security Breaches: Two emerging narratives in the crypto space include tokenized real-world assets (RWA) and Social DApps (SocialFi), with the latter exemplified by the success of the Friend.tech DApp, which experienced rapid growth in active wallets. Emerging Narratives: The crypto market has been on a remarkable upward trajectory in October, with surging by over 25%, and the total market capitalization reaching an impressive $1.3 trillion. However, a retrospective glance at Q3 2023 reveals a period of relative stagnation and subdued optimism compared to the current market dynamics. Bitcoin’s price In this comprehensive market overview, we will delve into the performance of various crypto metrics and shed light on some of the emerging narratives and niche innovations within the digital asset realm. Market Overview The total crypto market cap declined by 9.6% in Q3, closing at $1.12 trillion, down from $1.24 trillion in the previous quarter, according to . This is despite the frenzy caused by discussions around the possibility of a Bitcoin Spot ETF approval in the U.S. Coingecko On the brighter side, the market is now pricing in the probability of ‘when,’ not ‘if,’ based on the latest developments, which could see several Bitcoin Spot ETFs debut in the U.S. as early as next year. Trading Volumes on Exchanges Continued to Decline Trading activity took a 23% nosedive across the top 10 crypto exchanges; according to a by TokenInsight, Q3’s trading volumes totaled $6.1 trillion compared to $8.3 trillion in Q2. Notably, Binance was the most hard-hit crypto exchange, with its market share tanking to 44%, thanks to the legal hurdles the exchange is currently facing in multiple jurisdictions, including the U.S. For context, Binance enjoyed a market share of over 66% earlier in the year before its woes began. report Bitcoin’s Fundamentals Improving While Bitcoin’s price was stagnant for most of Q3 2023, it has rallied by over 28% this quarter, and few metrics indicate that this could be the beginning of a secular bull market. I’ve highlighted the main four drivers for this below: 1. BTC Supply is Sitting Still The percentage of inactive BTC supply in circulation is currently at 29.6%, the highest it has ever been since Bitcoin’s debut. This suggests that BTC long-term HODLers have a strong conviction and are also likely positioning for the halving expected in 2024, which will see Bitcoin’s reward per block halved from the current 6.25 BTC to 3.125 BTC. 2. Miners are Committed and Continue to Invest Bitcoin’s computational power (hash rate) has been on the rise, indicating that the network is becoming more and more secure. Currently, the hash rate is at 445 EH/s, up from 393 EH/s at the beginning of Q2 2023. 3. Bitcoin’s Dominance Trending Upwards Bitcoin’s dominance is also on the rise, currently at 51%, compared to 46% at the onset of Q2 2023. Historically, an increase in Bitcoin’s dominance has often preceded bull markets. It is also interesting to observe that liquidity is drying up on altcoin pairs, which is evident in the BTC/ETH chart. 4. Future ETF Approvals Causing Excitement This excitement surrounding the approval of the Bitcoin Spot ETF and applications submitted by prominent fund managers, including Blackrock, as well as Grayscale’s legal victory against the SEC. Larry Fink, Blackrock’s CEO, is also on record recently to Bitcoin’s recent rally as a ‘flight to quality’ in light of current geopolitical tensions and macro uncertainties. referring Layer 1s Stagnating and Layer 2s Rising The third quarter of 2023 witnessed a decline in the number of active users on Layer 1 smart contract blockchains, with Near being the only ecosystem that recorded an increase in its on-chain activity following the launch of the USDC stablecoin in Near’s ecosystem. The Layer 1 and Layer 2 landscape has also witnessed notable shifts in their share of active users, daily transactions, and generated fees, with more crypto natives opting for the latter due to the high fees associated with the Ethereum network. Source: Fidelity Digital Assets Base Emerges as a Leading Layer 2 Chain Base, an Ethereum Layer 2 solution developed by Coinbase and built on Optimism’s OP stack, is now a strong contender in the Layer 2 space. The chain, which launched as recently as August 9th, witnessed a peak of 1.8 million daily transactions. This can be attributed to popular projects like Friend.tech, a socialfi DApp, which is building on Base. Decentralized Finance (DeFi) Similar to the broader crypto market, the total value locked (TVL) in DeFi protocols plunged from $45 billion to $38 billion during Q3 according to . DeFi Llama Liquid Staking was the #1 DeFi Sector in TVL Since Ethereum transitioned to a Proof-of-Stake (PoS) blockchain and, finally, the merge, which allowed withdrawals, the total number of ETH staked through Liquid Staking Derivatives (LSDs) has been on the rise, constituting a significant portion of the on-chain activity in DeFi. Data: Binance Research According to Coingecko, the number of staked ETH eclipsed 27.3 million in Q3, having grown by 3.5 million QoQ. Lido Finance accounts for the lion’s share with over 77% as of writing, which is causing a as to whether it poses a centralization risk to the Ethereum network. debate NFTs and Blockchain Gaming The NFT market, trading volumes and sales in this crypto sub-niche have been on a downtrend since February. The latest report by DappRadar reveals that Q3 recorded $1.39 billion in trading volume, down from $2.9 billion in the previous quarter. However, it is interesting to observe that during Q3 2023, there was an increased interaction with NFT socialfi DApps, although blockchain gaming retained its position as the most dominant category in the NFT space. Crypto VC Funding Q3 2023 The crypto VC market also continued to face headwinds, with investors remaining on the sidelines in Q3 2023. According to a report by Galaxy, only $1.975 billion was invested in the crypto and blockchain sector during this period, marking a new low since Q4 2020. Binance Labs and Ethereum Foundation Among the Biggest Investors While the funding activity in Q3 marked a multi-year low, several noteworthy investors, including Binance Labs, the Ethereum Foundation, HashKey Capital, and Coinbase Ventures, a significant amount of funds toward blockchain and crypto projects. Notably, blockchain infrastructure and service projects attracted the most funding during the previous quarter. allocated Major Crypto Security Breaches Q3 2023 Mixin Network - $200.000.000 Mixin Network suffered a hack in September 2023. The breach occurred when hackers compromised the database of Mixin’s cloud service provider, resulting in the loss of digital assets worth $200 million. Multichain - $126.000.000 Multichain cross-chain protocol was abnormally drained of $126 million on July 7 when the digital assets on the MPC bridge were ‘exploited’ by hackers. According to on-chain data, over $102 million was drained from Multichain’s Fantom bridge, although post-analysis revealed this hack could also have been a rug pull by the Multichain team. CoinEx - $70.000.000 CoinEx experienced a cyber attack in September, resulting in the loss of approximately $70 million. The exchange noted that the attack was discovered by its risk control system, which “detected anomalous withdrawals from several hot wallets.” Curve Finance - $61.700.000 Multiple pools on Curve Finance, using Vyper, were compromised through a reentrancy vulnerability in July 2023, resulting in a loss of over $60 million. However, in a surprising turn of events, the hacker later posted a message on the Ethereum network, stating that they would return the funds to avoid ruining the compromised protocols. So far, they have returned $8.9 million worth of Alchemix ETH (alETH). Alphapo - $60.000.000 Alphapo was also hacked in July with trails pointing to the infamous Lazarus Group, a cybercrime syndicate from North Korea. Initially, the losses were estimated to be around $21 million but were later revised upwards to $60 million when on-chain sleuths discovered that the hackers had also compromised Alphapo’s old addresses. Stake.com - $41.300.000 Stake.com experienced a security breach in September 2023, resulting in a loss of $41.3 million. The attackers initially transferred $16 million worth of DAI, USDT, USDC, and ETH from Stake.com’s ETH address to their personal address, after which they converted the funds into ETH. CoinsPaid - $37.300.000 CoinsPaid fell victim to an attack by North Korean hackers in September 2023. The hackers drained $37.3 million. Key Developments in Crypto Regulation Q3 2023 – Federal district judge Analisa Torres that the act of selling XRP to public buyers through programmatic means and the distribution of XRP to employees of Ripple Labs were not in violation of securities regulations about unregistered securities. 13th July ruled – Sam Bankman-Fried was following a judge’s decision to support federal prosecutors’ motion to revoke the bail of the FTX founder, citing allegations of witness tampering. 11th August incarcerated – Grayscale Investments, a crypto asset manager, achieved a significant against the United States Securities and Exchange Commission in its pursuit to convert its over-the-counter Grayscale Bitcoin Trust (GBTC) into a publicly listed Bitcoin ETF. 29th August win Emerging Narratives This new DeFi sub-niche is currently a hot topic both within and outside of crypto circles. According to from Coingecko, tokenized U.S. Treasury bills have been the most significant on-chain driver of the RWA sector this year, growing from $114 million in January to over $665 million as of the end of September. Tokenized Real World Assets: statistics This is another emerging area of innovation that is gaining significant traction. One good example that fared particularly well in Q3 is the Friend.tech DApp; in the past month, the number of unique active wallets (UAWs) has grown by over 200% to 576,000. Social DApps (SocialFi): Conclusion Q3 2023 was quite a rollercoaster for the crypto market. On one hand, there was some optimism given the news of an expected Bitcoin ETF approval in the U.S. just around the corner, and on the other, the broader market outside Bitcoin did not have a major reaction to this news. However, looking ahead, momentum is gradually picking up. Bitcoin’s recent rally could mark the beginning of a new price trend as we move towards the halving in 2024. Also published . here Enjoyed these insights? There's more where that came from. Follow me on for daily tidbits and updates. Twitter/X

Bitcoin's Dominance Grows, ETF Excitement Builds in Q3 Crypto Overview

বিটকয়েনের আধিপত্য বেড়েছে, Q3 ক্রিপ্টো ওভারভিউতে ETF উত্তেজনা তৈরি করেছে

Die Dominanz von Bitcoin wächst, die ETF-Aufregung nimmt im dritten Quartal zu. Krypto-Übersicht

El dominio de Bitcoin crece y el entusiasmo por los ETF aumenta en el tercer trimestre

La domination de Bitcoin augmente et l'enthousiasme des ETF augmente au cours du troisième trimestre

बिटकॉइन का प्रभुत्व बढ़ा, तीसरी तिमाही के क्रिप्टो अवलोकन में ईटीएफ का उत्साह बढ़ा

ビットコインの優位性が高まり、ETFの興奮が第3四半期に高まる 仮想通貨の概要

비트코인의 지배력 증가, 3분기 암호화폐 개요에 ETF 기대감 고조

O domínio do Bitcoin cresce, a excitação do ETF aumenta na visão geral da criptografia do terceiro trimestre

Доминирование Биткойна растет, ажиотаж вокруг ETF растет в обзоре криптовалют в третьем квартале

Bitcoin'in Hakimiyeti Artıyor, 3. Çeyrekte ETF Heyecanı Artıyor Kriptoya Genel Bakış

Sự thống trị của Bitcoin tăng lên, sự phấn khích của ETF tăng lên trong tổng quan về tiền điện tử quý 3

比特币的主导地位不断增强，第三季度 ETF 兴奋不已

TLDR: Ergo (ERG), launched in 2019, uses the unique Autolykos Proof of Work (PoW) consensus protocol to be ASIC-resistant. The article outlines the process of setting up Ergo mining, which involves selecting a suitable GPU, building a mining rig, creating an Ergo wallet, joining a mining pool, and choosing mining software. It also provides an overview of the Ergo tokenomics, network stats, and details on the factors that affect mining rewards. Factors that affect Ergo mining rewards include initial setup costs, electricity costs, ERG price volatility, software and hardware configuration, and hardware maintenance and repair costs. Based on a hypothetical scenario, Ergo mining is profitable if electricity costs are below $0.08/kWh. Even then, there may be doubts if it’s worthwhile. Therefore aspiring crypto miners are urged to thoroughly consider all factors before proceeding. Introduction to Ergo Mining This article briefly introduces you to the Ergo (ERG) cryptocurrency. Next, the article will guide you through the Ergo coin mining process. The article assumes you know the of cryptocurrencies, , and how crypto mining works. basics blockchains Ergo(ERG) is a cryptocurrency launched in 2019, with no ICO, pre-mined tokens, or pre-allocated tokens to team members and VCs. According to Ergo’s , every ERG token is protected by the Sigma cryptographic protocol and uses a scripting language called ErgoScript. Using ErgoScript enables users to create smart contracts on the Ergo blockchain. whitepaper Ergo uses its own unique Autolykos Proof of Work (PoW) consensus protocol to verify transactions on its blockchain. Moreover, the protocol ensures Autolykos ASIC miner resistance. Autolykos ASIC miner resistance is important because huge miners dominate blockchain networks like Bitcoin. These miners have access to expensive ASIC mining machines, making mining unviable for the average person. Therefore, making the Ergo blockchain ASIC-resistant with the Autolykos mining protocol is important to make mining more affordable. A Brief Overview of Ergo Tokenomics and Network Stats Before embarking on a cryptocurrency mining journey, you must understand its . As of the time of writing, the circulating supply of ERG tokens is around 71.15 million tokens and has a market cap of around $90.5 million. tokenomics Next, the network currently handles about 5994 transactions daily and takes 120 seconds on average to add a new block of transactions. Moreover, each ERG block successfully mined rewards with a min payout of 39 ERG tokens. Finally, the blockchain possesses computational power or a hashrate of 19.39 TH/s. How to Mine the Ergo Crypto When learning how to mine Ergo, we start by building a GPU mining rig and setting up an Ergo wallet. Next, we configure the hardware and software for the Ergo mining rig. Finally, we connect the Ergo miners to a mining pool. Choose a GPU As Ergo is ASIC-resistant, you must use a graphics card’s GPU to mine Ergo. Suitable GPUs must have a memory of more than 3GB. Popular graphics cards for mining Ergo include: Nvidia GTX 1060 GTX 1660 Ti RTX 3060 RTX 3060 Ti RTX 3070 RTX 3070 Ti RTX 3080 Ti RTX 3090 AMD RX 470 RX 580 Radeon 5700 XT RX 6600 XT RX 6800 RX 6800 XT While buying the cheapest GPU is tempting, you must consider the GPU’s cost versus its mining capabilities. The cheapest GPU may not be powerful enough to generate adequate mining rewards. However, the most expensive GPU may not be worth it for the rewards generated. LHR and GPU Mining Due to graphic card shortages, Nvidia GPUs are artificially limited in their crypto-mining capabilities. Hence, Light HashRate (LHR), was introduced in the latest Nvidia drivers to impose this limitation on Nvidia GPUs. The degree of LHR impact depends on the type of GPU memory and its manufacturer. When choosing a GPU, t have shown that Nvidia GPUs with GDDR6 Hynix memory are the most affected by LHR. Therefore, keep this in mind when choosing a suitable Ergo mining GPU. ests Building the Best Ergo Miner After choosing your GPUs, you must (basically a PC) to house the GPUs for crypto mining. build a mining rig Install Windows or Linux as the mining rig’s operating system. Once your mining rig is complete, give it a name, known as a , and Rig ID note it down. Create an Ergo Wallet You need an Ergo wallet to receive your mining rewards. However, some use , like Ergo mining Binance addresses, to cash out quickly and regularly. centralized exchange addresses If you want to hold ERG longer, it’s highly recommended that you use , such as the official Ergo wallet app. Once you have your , Ergo wallets wallet address note it down for later use. If you’re considering using a hardware wallet instead, you must note that hardware wallets have when used for mining purposes. issues Joining a Mining Pool Next, you want to join a mining pool. Although solo mining allows you to keep all block rewards, you might go for weeks or months without finding a block to successfully mine. Joining a mining pool allows you to pool your computing resources with other miners to increase everyone’s chances of getting block rewards. Mining pool block rewards will be distributed across the mining pool, and everyone will receive a smaller reward. However, rewards are more likely to be received in a mining pool. Therefore, the average crypto miner benefits by joining a mining pool as they earn smaller mining rewards more frequently. Popular Ergo coin include: mining pools Ergo pool 2miners Herominers Nanopool F2pool To join a mining pool, visit the mining pool’s website and the For example, if we want to use 2miner‘s Ergo USA server, we would note down the address: note down mining pool’s server address. us-erg.2miners.com:8888 Some mining pools require registering a free account. Therefore, check each mining pool’s website and follow their instructions. Choosing Your Mining Software The mining rig requires mining software to begin mining Ergo coins. Installing the best mining software depends on the type of GPU and operating system used in your mining rig. The top mining software for Ergo miners are: NBminer Team Red Miner SRB Miner (Has an LHR unlocker to mitigate some LHR impact) T-Rex Miner lolMiner NBminer is one of the popular Ergo mining software and reviews have shown that it’s good for Nvidia GPUs, while SRB Miner is good for AMD GPUs. Mining Software Configuration Guide First, download your chosen mining software archive and extract it. You may have to whitelist the software in your antivirus program, as the antivirus may flag the mining software as a malicious threat. After extracting, find a configuration file, usually a file or a file. Open the configuration file in a text editor like Notepad. .bat .cmd Recall your: Rig ID Ergo wallet address Mining pool’s server address. Copy and paste the three pieces of information into your mining software configuration file. Below is an example of how NBminer’s .bat configuration file looks like. nbminer.exe -a ergo -o stratum+tcp://erg.2miners.com:8888 -u YOUR_WALLET_ADDRESS.RIG_ID
pause In the example above, the is added before “-u.” The is after the “-u.” Finally, the is added behind the Ergo wallet address after a period. mining pool’s server address Ergo wallet address Rig ID Once you’re done, save the configuration file changes in Notepad. Take note that other mining software’s configuration files are not 100% similar but should follow a similar pattern. Operating System Tweaks If you’re using a Windows operating system, you must navigate to the Windows Power Settings in Control Panel and set it to Never Sleep. Next, turn off Windows Update in Control Panel. This is to ensure your miner is not interrupted while mining. Finally, ensure Window’s Virtual Memory, or pagefile, is set to at least 16 GB. Now you’re ready to run the mining software. Earn Ergo rewards by starting to mine today! How do I Check My Rewards? After 24 hours, you can check if your mining setup works by checking your wallet address in the . There, you can view transactions of mining rewards or the number of coins coming in. Ergo coin block explorer Moreover, your Ergo mining pool account dashboard provides a summary report for average mining rewards and hashrates. Factors Affecting Mining Rewards Finally, we arrived at the fun part. Most miners want to make a profit, so knowing how to estimate mining Ergo profit, is very important. Here are factors that affect your crypto mining profits. Initial Setup Costs The more initial outlay, the longer it takes to break even from mining. Apart from GPU costs, the remaining mining rig parts and the mining environment setup will also incur upfront costs. As crypto mining rigs produce a lot of heat and noise, crypto miners have to spend money to provide good cooling, ventilation, and soundproofing for their mining rigs. Electricity Costs The next factor is a huge one. Electricity costs are the number one factor that eats into profitability. Crypto mining in locations with high energy costs results in unprofitability. Furthermore, natural disasters or geopolitical conflicts could see energy costs soaring. We could see this happening in Europe during the start of the Ukrainian conflict. Some miners cut their electricity costs by accessing cheap renewable energy. For example, from oil production to power crypto mining cheaply is possible. using waste natural gas Apart from accessing cheap renewable energy, cryptocurrency miners often flock to locations with low energy costs. Countries with low average and decent infrastructure for crypto mining include: energy costs China at $0.08/kWh Malaysia at $0.047/kWh Qatar at $0.032/kWh Argentina at $0.034/kWh Ergo Coin Price Volatility As an asset class, cryptocurrencies are known to be volatile and high-risk. Ergo coin price is no exception to this. If Ergo’s price drops too low, mining could be unprofitable after factoring in running costs. Software and Hardware Configuration The computing power of GPUs largely determines how the number of coins you receive. You can configure a GPU to increase its computing power through a process known as “overclocking.” However, overclocking may risk potential system instabilities. Moreover, it produces additional heat, which reduces hardware reliability and lifespan. Additionally, overclocking increases electricity consumption. If the overclocking manages to be stable, you can maximize your GPU’s mining reward potential. Miners can also squeeze more profits through a hardware configuration called ”undervolting.” Undervolting makes a mining rig work with less electric power. Undervolting aims to boost mining reward efficiency by reducing electricity costs and decreasing heat generation. However, undervolting could risk introducing potential system instabilities and risk hardware damage. Finally, the type of mining software used on your hardware configuration could also mean the difference between more or less mining rewards. For example, mining software like NBminer works better on an Nvidia card than SRBminer. Hardware Maintenance Crypto mining rigs generate lots of heat and work for long periods of time under full loads. Therefore, any hardware maintenance and repairs will eat into mining profits. Is it worth it?: A Hypothetical Mining Scenario Before you start mining Ergo, you should use an online Ergo mining calculator, like the , to help you estimate your crypto-mining rewards. Whattomine Ergo mining calculator With entered hashrate, you can estimate mining rewards and profitability. Furthermore, this estimation can be more accurate by entering electric costs, current crypto prices, blockchain mining difficulty, and GPU specs. In a hypothetical Ergo mining scenario, we assume the to be $0.23/kWh. We also assume we have an AMD 5700 XT Ergo mining rig. average United States electricity cost In this scenario, we estimate “earning” negative $0.64 every 24 hours. This is due to the high electricity costs in the United States and the current prices of Ergo. However, by bringing down electricity costs to $0.08/kWh, you can break even. Therefore, assuming all other factors are constant, Ergo mining is only profitable if electricity costs are below $0.08/kWh Conclusion In conclusion, Ergo mining is an intriguing and educational venture for cryptocurrency enthusiasts. The Sigma cryptographic protocol protects the ERG token and relies on a unique Autolykos PoW consensus protocol, making the Ergo blockchain ASIC-resistant. Initial set-up costs and high electricity costs may challenge profitability. Additionally, the choice of mining hardware, mining pool choice, and hardware and software configurations all contribute to the efficiency of earning Ergo mining rewards. It’s worth noting that Ergo mining involves risks such as Ergo coin price volatility, volatile energy costs, and hardware or software failure. Ultimately, besides educational purposes, Ergo mining’s worth is doubtful, as it’s only profitable with electricity costs below $0.08/kWh. FAQ Is Ergo crypto mining ASIC resistant? Yes. The Autolykos protocol Ergo uses makes it ASIC-resistant, allowing you to use consumer GPUs for mining. Is Ergo mining affected by LHR? Yes, LHR affects Ergo mining. Mining with Nvidia GPUs using GDDR6 Hynix memory is the most impacted by LHR. The T-Rex mining software has an LHR unlocker to mitigate some LHR impact. However, the software only unlocks up to 80% of the hashrate on GDDR6 Hynix memory GPUs. Does an RTX 3060 Ti LHR affect mining Ergo and Ravencoin? LHR affects Ergo and Ravencoin mining. If the RTX 3060 Ti uses GDDR6 Hynix memory, the LHR impact is higher than non-GDDR6 Hynix memory GPUs. Can you use an Ergo mining CPU rig? Using a CPU to mine Ergo is possible but not recommended. When comparing hashrates and power consumption, a CPU is less efficient than a GPU to mine Ergo. You can mine Ergo with your CPU using mining software such as . SRBminer Can you use a GPU to mine Ergo? Yes. You must use mining software such as to use your GPU as an Ergo miner. NBminer What GPU specifications are needed for Ergo mining? Suitable Ergo mining GPUs must have memory exceeding 3GB. Ideally, if it's an Nvidia GPU, ensure that it doesn't have GDDR6 Hynix memory to reduce LHR’s impact. Is there an Ergo ASIC Miner? No. As Ergo uses the Autolykos ASIC miner resistant protocol, there are no Ergominer ASIC machines.

Is Ergo Mining Worth it? Uncovering Ergo's Mining Process

The Ethereum is based on the Bitcoin protocol and its Blockchain design but is modified so that applications outside the monetary systems can be maintained. The only similarity of the two Blockchains is that they store whole transaction histories of their corresponding networks, but Ethereum does much more than that. In addition to the transaction history, each Ethereum network node must also download the most recent status, or current information, of each smart contract in the network, each user’s balance, and all smart contract code and where it is stored. Blockchain How to Mine Ethereum? You will need to use your computer to . If you have been involved with Ethereum, you should be aware that it works in its Blockchain. All the transactions on the protocol need to be approved. Each of the transactions needs to be verified and placed into the Ethereum Blockchain. This verification process is referred to as PoW or . mine Ethereum Proof of Work Well, if you are a miner, you need to ensure that no one in the blockchain cheats the protocol. The way this is done is through solving the complex mathematical problems. Once you do that, you communicate it to the other miners. If 51 percent of the miners agree to the number being correct, the newly mined Block will be added to the blockchain. To be able to undermine, you need a PC — preferably desktop — equipped with a graphics card. Since Ethereum mining primarily uses video memory, you must ensure that your graphics card has at least 2GB of RAM. This prerequisite passed, we then have the necessary to mine. A Pool of Mining In general, the only rewards minors who find a real “block” of transactions. Only the minor who calculates the “good” transaction block will be rewarded. At equal computing power, the probability of breaking a block is random. To increase its chances, one then increases the power of computation. Unless you invest heavily in mining equipment, the chance of finding a block on your own is meagre. This is where a “pool” of mining intervenes. cryptocurrency protocol The Mining Options Well, there are several options you can use to mine Ethereum. However, the most popular among them is . In fact, it has been considered to be the most trusted option for mining. The other mining methods include mining alone or using cloud-based mining services. Pool Mining Experts suggest not opting for mining alone or going with a cloud-based service. Mining through Pool Mining option is one of the best, trusted and most comfortable choice in making a beginning. The Pool Mining will let you work with other people, and thus they will be able to agree with one another (or reach consensus if we use the exact term) and share rewards. However, you should be vigilant enough while choosing the pools. Not all pools may be similar. There are a few considerations you need to go through. Some of the features you need to pay attention to are the pool size, pay-out, and the pool fees. A pool with an optimum size would be helpful in getting to work with more miners and a comfortable sharing of rewards. Go for a pool mine that is transparent, fair and easy to use. Also, check out the pools that have a lower minimum pay-out level. This will help you get better and routine returns than waiting till you reach the threshold. A higher pool fee may not be a practical option. Check out if the pool fee is quite minimum. These payments are percent based. It would be dependent upon the cryptocurrency you are mining. The preferable pool fee should generally be around 1 to 3 percent. Any pool that charges beyond 3 percent fee may not be a good idea. One such great option if you are looking for a pooled mining is . The service works are designed in such a manner that even the newbies would be able to able to work with it comfortably. It offers you Ethash algorithm for mining Ethereum. In fact, it provides you with two options for mining Ethereum. You can either operate in PPLNS mode wherein all miners work with each other and share the rewards between them. If you are confident enough, you can mine alone in the Solo mode. 2Miners Pool What Would You Need to Mine Ethereum? Once you have a computer to mine your Ethereum blocks and opted for a proper and efficient pool mine that you want to work with, you would need access to a few accessories to work with. Some of the other accessories you would need include – • Ethereum Wallet to hold the newfound currency. • Efficient GPU drives • A mining application. You may choose one of the options in the form of Claymore miner. • A mining pool address. • A graphics cards. You would need a minimum of 3 GB of RAM • An operating system that functions efficiently. Windows 7 or 10 with 64-bit architecture should be one of the best options you can go with. Ensure that you have downloaded the right drivers for your GPU so that you would not run into any issues. Casper Update- A Milestone for Ethereum An upgrade known as Casper will do the passage of the proof of stake. Recently the Ethereum developers have released a new version of the . The goal of the developers is to make Casper as versatile as possible. Casper code available to the public Ethereum will become much rarer once the upgrade to Casper is implemented. The Casper FFG (Friendly Finality Gadget) is a combination of Proof-of-Work (POW) and Proof-of-Stake (POS). Soon, they plan to go entirely to the POS consensus. With this upgrade, the blocks will be rewarded with 0.82 ETH instead of 3 ETHs thus reducing the inflation rate. However, what is Casper? Casper FFG was published in October 2017. The aim is to create a hybrid consensus system to correct the problems associated with cryptocurrency extraction. The transition from the proof of work network to the evidence of issue will, therefore, be through the Casper initiative. For Ethereum, moving from proof of work (POW) to proof of stake (POS) has always been part of the long-term plan. PoW uses a significant amount of energy and has no absolute monetary value. Casper’s FFG protocol can be implemented over any block proposal mechanism, which will give the string on which it rests. The FFG overlay mechanism requires a minimum of protocol modification, which allows the network to test and evaluate the Casper FFG over PoW fully. (layer system like Bitcoin and segwit + LN) For What Reason to Move to The Proof of Stake? One of these reasons would be high energy consumption. However, also issues of equal access to mining equipment, control of “Mining Pools” and an evolving market for ASIC miners. At some point, it will become challenging to mine Ethereum because of the high costs that do not offset the benefits. The will protect the network by relying on the computing power of the users. However, it is much less energy consumption compared to the proof of traditional work. proof of stake Solutions are currently being developed to solve some of Ethereum’s most urgent problems. Casper, sharding, and plasma are aimed at improving the network and its performance. Ethereum has scale-up severe issues right now, whose evidence was highlighted when the system almost ceased operating under a stack of digital kittens in December of last year. Our Conclusion on Casper: Casper developers are well aware of the risks associated with this impending change. To counter potential problems, Casper will use a “programmed economy” model. Any network node attempting to attack the network through malicious or other behaviour will be penalized. There is still much work to be done although Casper looks promising on paper. It will make Ethereum safer and more efficient in the next few years. Casper seems to be a breakthrough in the development of Ethereum. Ethereum co-founder Vitalik Buterin recently presented all the latest details on the Casper test. Note that it is possible that it is set up within 2 to 4 months. He said the process for end users would be as easy as just clicking on a mouse. The Concluding Thoughts Mining Ethereum is the right way to stay decentralized and earn rewards. It has proved itself to be worth the attempt. The market has been responding quite well to Ethereum mining. With a host of people opting for Ethereum mining and the growing success rate that it has been able to garner, we would indeed foresee a great future for the concept.

The Beginners Guide for Ethereum Mining and Casper Update.

Bitcoin and the energy usage dilemma If you’re moderately well versed in the blockchain ecosystem, then you would have by now come across the energy consumption debate that is taking place in relation to Mining. Yes, Bitcoin requires a lot of energy, and not a modest amount either. Mining (under the current protocol of Bitcoin’s algorithm) is consumptive of energy. Bitcoin Mining proof of work deliberately In fact, according to a recent article, it was estimated that the Bitcoin network uses 0.14% of the global energy consumption and more power than several developing nations, as displayed in the illustration above. Cointelegraph A tale of two consumers Now, bare in mind, nations need to heat and light households, operate machinery, power manufacturing plants, refrigerate food for millions of people, etc. Bitcoin, on the other hand, has to verify 5 transactions per second and add new blocks to the blockchain every 10 minutes or so, hardly major physical and computational graft, so, it does beg the question, is proof of work really the most efficient method of mining new coins and verifying transactions? Or, can we do better? Is it right that we continue inefficiently burning nation-state equivalent sums of electricity, for what is ultimately, an egg hunt that doesn’t ultimately directly benefit the network? This factor, is perhaps the single point of disagreement that I have with most long-term Bitcoin community members. I can’t recall a time that I’ve ever heard (or read) a word from Andreas Antonopoulos that I’ve disagreed with, apart from in relation to this matter. Even he admits that there is only room on this globe for 1 proof of work based network. The revelation in that statement being that multiple proof of work algorithms could ultimately cause some kind of energy crisis? Why does Mining consume so much energy? Well, why do we need miners is the first important question, and the answer is two-fold. To produce new Bitcoins and to secure the network. In order to compete for a block, the mining community need to solve a puzzle that has been encrypted. I could go into difficulty adjustment levels, leading zero’s and SHA256 to explain how task is executed, but all you need to know at this stage is that solving this puzzle serves no purpose for the Bitcoin network other than to create a lottery system that consumes a lot of energy for the participants. The use of energy is deliberately high, and incrementally adjustable so as enforce an unavoidable cost on all who participate. The ‘Nonce’ (solution to the puzzle) is just a way to equalise the possibility of success in a pool of miners. Because it’s random (and encrypted), 2 miners with the same equipment have equal likelihood of solving the puzzle by the finding the nonce, and thus making away with the booty (to use a pirate analogy). The problem is, the number of miners currently simultaneously taking part in the search for this means that the difficulty level is very high and ever increasing as the price of Bitcoin continues to skyrocket as more people get interested in mining. nonce Hence we have an increasing number of miners solving an increasingly difficult puzzle to confirm a comparative handful of transactions. The result is a considerable waste. The power being consumed by miners to participate in Bitcoin mining is becoming undeniably substantial, especially when considered cumulatively. Is it needed or is just nonce-sense? The problem does not lie with the demand for power, if in fact the Bitcoin network actually it, there would be no debate from the community. Believe me, if it cost 100 times what it does now in order to successfully support and maintain a decentralised, secure, independent, publicly owned and incorruptible network for currency and global transactions that gives the masses an alternative to the banking system, then by god, I’d be all for it — the cause is more than honourable enough, and there is no questioning the value of Bitcoin. But ultimately it’s power that is literally being utilised for no other reason but to impose an artificial expense. required Bitcoin miners being forced to ‘prove their work’ by completing wholly superfluous calculations in order to win the mining lottery. The reason it’s needed The justification that is largely reiterated by our dear Bitcoin community is that it was designed to be this way to attach a cost to mining, lest the network become spammed or insecure. If it was too cheap and easy to mine people would be getting involved in the network and risk approving bad transactions, or demanding sky-high fees as there is no risk associated to your block being rejected. It is a way to force miner scarcity and participant quality, I guess? Indeed, this is the argument has been . But is proof of work the only, or even the best method for the support of the network and the creation of new coins? eloquently posited and is largely reiterated by most in support of proof of work Here are 3 of the main problems I see with the current proof of work setup: 1. The Competitive disadvantage and inevitability of monopoly Where financial incentives and personal interests collide, you get divisions. These are inevitable in any functioning ecosystem and Bitcoin should certainly not be de-incentivised. However, what we are increasingly witnessing the emergence of a new political class within the Bitcoin network. It seems that miners, for purely economic reasons are increasingly brining their own agendas to the forefront. This has contributed massively to the new trend of hard-forking for political differences. is almost exclusively a result of the disagreements about mining difficulties and compensations using the proof of work algorithm. The forking of Bitcoin Miners have invested small fortunes in ASIC processor powered ‘mining farms’ that are specialised for mining Bitcoin, and not only has this made it almost impossible for new entrants to enter the Bitcoin mining pool, it has also resulted in Bitcoin being forked to form alternative revenue streams for these groups. Segwit was opposed by miners because of the reduced mining reward, (the Lightning Network will likely cause further tumult if adopted en masse in the Bitcoin network, as it takes transacting off chain and will reduce greatly the demand for transaction confirmations and new blocks). Other currencies since have attracted miners by increasing the block sizes but as a consequence, may have inadvertently decreased competition by making it increasingly harder for independent miners to compete with the larger mining farms. This centralisation of what underpins the security of Bitcoin is increasingly being considered as a concern for those attracted to Bitcoin’s decentralisation. 2. Barrier to entry and Economic Disadvantage for poorer communities Whether or not we like to admit it, the entire mining industry is economically unfair. First of all there is the basic fact that Bitcoin’s price is not linked to the petrodollar (Thank god!), but this ultimately means that if you live in a region where electricity is not subsidised, you are at a considerable economic disadvantage in comparison to mining rigs set up in subsidised nations. In addition to this, the start up cost of attaining ASIC processors and cooling equipment has left most developing nations high and dry. In fact, no more than 15 mining pools pretty much have oligopoly over the entire bitcoin mining infrastructure. That is shockingly close to being centralised and is hardly the egalitarian utopia that was envisioned in Satoshi’s whitepaper. _A pie chart showing the hashrate distribution between the major bitcoin mining pools - Blockchain_blockchain.info Hashrate Distribution 3. Links Bitcoin to the Fiat economy Finally, and most frequently overlooked, is that enforcing processing power as a monetary commitment intrinsically links Bitcoin to FIAT currency, which is ultimately counter-intuitive. Think about it logically: we are enforcing commitment of FIAT in order to mine Bitcoin? Why? Bitcoin is an attempt to create a new ecosystem. Immutable digital cash, so why are requiring a FIAT transaction to take place to secure our network. Yes there should be a currency expense, but FIAT is not the only form of currency. What do you think of proof of work? Are you in support, or do you think there might be room for an alternative? I obviously could be way off on this one, so I’m definitely open to all community feedback. Is there an alternative or is this an unavoidable necessity for the long term security of the Bitcoin Network? I am in the process of drafting 2 alternative concepts for coin creation and network security called ‘proof of time’ and ‘community proofing’. These aren’t ready, and might not even be feasible, but it will be fun seeing how they’re received. Comments below please.

Proof of work, or proof of waste?

NiceHash, a leading cryptocurrency mining platform, has announced the release of custom firmware for Antminer Kaspa ASICs, marking a significant development in the Kaspa mining ecosystem. This firmware, reportedly the first of its kind for Kaspa miners, aims to enhance the performance and efficiency of Antminer KS series devices. Performance and Efficiency Gains According to NiceHash, real-world tests have shown that their custom firmware can increase ASIC performance by up to 20%. The company also claims improvements in energy efficiency, potentially lowering operational costs for miners. Additionally, the firmware includes thermal protection features designed to prevent overheating, which could extend the lifespan of mining hardware. Supported Hardware and Installation The firmware is compatible with several Antminer models, including the KS5 Pro, KS5, and two variants of the KS3. However, installation is not straightforward due to recent manufacturer updates. Many Kaspa Antminers now run stock firmware versions that block custom upgrades, necessitating the use of additional hardware. To address this, NiceHash has introduced the "Cracker Card," a hardware add-on that enables custom firmware installation on CVITech control boards. This card must be physically attached to the miner's control board before firmware installation can proceed. NiceHash is currently offering the Cracker Card and custom firmware exclusively to its users. Large-scale mining operations can request the hardware directly from NiceHash, while smaller operators with fewer than 100 machines may soon be able to purchase the cards through NiceHash's online shop. Industry Impact and Considerations The introduction of custom firmware for Kaspa ASICs could have significant implications for the mining community. Improved efficiency and performance may lead to increased profitability for miners, potentially attracting more participants to the Kaspa network. However, the requirement for additional hardware and the firmware's exclusivity to NiceHash's platform may limit its immediate adoption. Miners will need to weigh the potential benefits against the costs and complexities of implementation. Fee Structure and Compatibility NiceHash has implemented a dynamic fee structure for the firmware, ranging from 1% to 4% based on the level of overclocking applied. This tiered approach allows miners to balance performance gains with associated costs. It's worth noting that the firmware is currently compatible only with NiceHash's mining pool, which may influence miners' decisions to adopt the technology. As the cryptocurrency mining landscape continues to evolve, developments like NiceHash's custom firmware highlight the ongoing efforts to optimize mining operations and improve hardware efficiency. The long-term impact of such innovations on the Kaspa network and broader mining ecosystem remains to be seen. Don’t forget to like and share the story! Vested Interest Disclosure: This author is an independent contributor publishing via our business blogging program. HackerNoon has reviewed the report for quality, but the claims herein belong to the author. #DYOR NiceHash, a leading cryptocurrency mining platform, has announced the release of custom firmware for Antminer Kaspa ASICs, marking a significant development in the Kaspa mining ecosystem. This firmware, reportedly the first of its kind for Kaspa miners, aims to enhance the performance and efficiency of Antminer KS series devices. Performance and Efficiency Gains According to NiceHash , real-world tests have shown that their custom firmware can increase ASIC performance by up to 20%. The company also claims improvements in energy efficiency, potentially lowering operational costs for miners. Additionally, the firmware includes thermal protection features designed to prevent overheating, which could extend the lifespan of mining hardware. NiceHash Supported Hardware and Installation The firmware is compatible with several Antminer models, including the KS5 Pro, KS5, and two variants of the KS3. However, installation is not straightforward due to recent manufacturer updates. Many Kaspa Antminers now run stock firmware versions that block custom upgrades, necessitating the use of additional hardware. To address this, NiceHash has introduced the "Cracker Card," a hardware add-on that enables custom firmware installation on CVITech control boards. This card must be physically attached to the miner's control board before firmware installation can proceed. NiceHash NiceHash is currently offering the Cracker Card and custom firmware exclusively to its users. Large-scale mining operations can request the hardware directly from NiceHash, while smaller operators with fewer than 100 machines may soon be able to purchase the cards through NiceHash's online shop. Industry Impact and Considerations The introduction of custom firmware for Kaspa ASICs could have significant implications for the mining community. Improved efficiency and performance may lead to increased profitability for miners, potentially attracting more participants to the Kaspa network. However, the requirement for additional hardware and the firmware's exclusivity to NiceHash's platform may limit its immediate adoption. Miners will need to weigh the potential benefits against the costs and complexities of implementation. Fee Structure and Compatibility NiceHash has implemented a dynamic fee structure for the firmware, ranging from 1% to 4% based on the level of overclocking applied. This tiered approach allows miners to balance performance gains with associated costs. It's worth noting that the firmware is currently compatible only with NiceHash's mining pool, which may influence miners' decisions to adopt the technology. As the cryptocurrency mining landscape continues to evolve, developments like NiceHash's custom firmware highlight the ongoing efforts to optimize mining operations and improve hardware efficiency. The long-term impact of such innovations on the Kaspa network and broader mining ecosystem remains to be seen. Don’t forget to like and share the story! Vested Interest Disclosure: This author is an independent contributor publishing via our business blogging program. HackerNoon has reviewed the report for quality, but the claims herein belong to the author. #DYOR Vested Interest Disclosure: This author is an independent contributor publishing via our business blogging program . HackerNoon has reviewed the report for quality, but the claims herein belong to the author. #DYOR Vested Interest Disclosure: business blogging program business blogging program

NiceHash Unveils Custom Firmware for Kaspa ASIC Miners

NiceHash predstavlja prilagođeni firmver za Kaspa ASIC rudare

NiceHash afslører brugerdefineret firmware til Kaspa ASIC Miners

NiceHash presenta un firmware personalizado para los mineros ASIC de Kaspa

NiceHash devwale mikrolojisyèl koutim pou minè Kaspa ASIC

NiceHash Luncurkan Firmware Khusus untuk Penambang ASIC Kaspa

NiceHash、Kaspa ASIC マイナー向けカスタムファームウェアを発表

NiceHash, Kaspa ASIC 마이너를 위한 맞춤형 펌웨어 공개

NiceHash ເປີດເຜີຍເຟີມແວທີ່ກໍາຫນົດເອງສໍາລັບ Kaspa ASIC Miners

NiceHash го претстави прилагодениот фирмвер за Kaspa ASIC рударите

НицеХасх представља прилагођени фирмвер за Каспа АСИЦ рударе

NiceHash, Kaspa ASIC Madencileri için Özel Ürün Yazılımını Tanıttı

NiceHash Kaspa ASIC konchilari uchun maxsus proshivkani taqdim etadi

The Noonification: How Greedy Miners Are Breaking DAG Blockchains (9/19/2024)

The Greedy Miner’s Dilemma: Flaws in DAG-Based Consensus Protocols

How Greedy Miners Are Breaking DAG Blockchains

ስግብግብ ማዕድን አውጪዎች DAG Blockchainsን እንዴት እየሰበሩ ነው።

كيف يقوم عمال المناجم الجشعون بكسر سلاسل الكتل DAG

Cómo los mineros codiciosos están destruyendo las cadenas de bloques DAG

Comment les mineurs avides brisent les blockchains DAG

Hogyan törik meg a kapzsi bányászok a DAG blokkláncokat

איך כורים חמדנים שוברים את שרשרת ה-DAG

貪欲なマイナーがDAGブロックチェーンを破壊する方法

របៀបដែលអ្នករុករករ៉ែលោភលន់កំពុងបំបែក DAG Blockchains

Cât de lacomi minerii sparg blockchain-urile DAG

Jinsi Wachimbaji Wenye Tamaa Wanavyovunja Minyororo ya DAG

นักขุดที่โลภมากทำลายบล็อคเชน DAG ได้อย่างไร

Yeka ukuthi Abavukuzi Abahahayo Baphula Kanjani I-DAG Blockchains

In the popular imagination, Bitcoin mining is like digging in the Copernicus Crater–as daunting as a lunar mission. The costliness and technical demands of the enterprise dissuade many from plunging into this lucrative endeavor. Yet, this was not always the case. How did we get here, and where are we going? In the beginning, the puzzles were easy. All you needed was a PC with a standard CPU. Back then, you received 50 Bitcoins (BTC) for successfully adding a block to the network. The potential value of Bitcoin was not widely recognized. 50 BTC, hardly worth a penny then, is now worth over 2 million USD. Of course, few could foresee the valuation Bitcoin would eventually garner. Case in point: Laszlo Hanyecz, who bought two pizzas for 10,000 BTC. He claims he has no regrets, but most (understandably) balk at this claim. As demand climbed and competition between miners intensified, basic CPUs would no longer suffice. They were first replaced by GPUs, which could keep the BTC rolling in by bringing more power to the table. GPUs (Graphics Processing Units) were now quickly cracking the increasingly difficult puzzles posed by the blockchain. This epoch also saw a shift towards communal mining, as mining pools formed to leverage their combined resources to improve their odds of all parties benefiting. Alongside Bitcoin’s swiftly ascending price, mining would continue to evolve, albeit in a punctuated fashion. Only 2 years after the Genesis Block was added to Bitcoin’s ledger, a third generation of hardware would come, FPGAs. Field Programmable Gate Arrays (FPGAs) brought more precision, as they allowed hardware and software to be customized to optimize the process. Miners could add custom code to juice up their virtual drill rigs to extract what was now digital gold. The downside was that the venture became more specialized, expensive, and intensive, a trend that continues up to the present. But with the price of a single Bitcoin at $5 in 2011, it was worth it, even to those who did not anticipate further growth. The First Halving The following year would witness BTC’s first halving. Now miners would only earn 25 BTC for adding a block. 2013 would see a watershed innovation with the introduction of Application-Specific Integrated Circuits (ASICs). Unlike their predecessors, they were devised specifically to mine Bitcoin. Unsurprisingly, the network's hashing power spiked tremendously when ASICs entered the fray. The advent of ASICs ushered in an ongoing arms race for the latest and greatest. Chip size has steadily decreased, allowing efficiency to escalate. But what about now? Let’s Go Mining As BTC became still more sought after, mining farms—operations that house a plethora of ASICs–sprung up wherever electricity was cheap and plentiful. All of this has made it exceedingly difficult for the lone miner to prosper. However, a solution is at hand. is a platform where users can purchase NFTs to own a portion of a sophisticated mining farm. This is a way to re-democratize Bitcoin mining. team of experts handles the tech-intensive tasks needed to excel in the contemporary landscape, taking care of all the required programming and upkeep. GoMining GoMining’s This gives casual users a way to be gainfully involved in the mining process. But the platform is just for newcomers. not It is also a welcome relief for those who have the desire (but not the time or capital) to invest in a Bitcoin farm, as it obviates the headaches that come with implementation and maintenance. By drastically lowering barriers to entry, is making mining accessible again; this could alter the ownership landscape. The democratization of Bitcoin mining could lead to a more diverse group of miners and potentially a more stable network. GoMining This diversity is crucial, as the concentration of mining power in the hands of a few large players has long been at odds with the decentralized ethos behind blockchain. Thanks to , Bitcoin has come full circle. GoMining

The New Secrets of Successful Bitcoin Miners

As the Bitcoin 2024 Halving is about to take place, miners’ rewards will be reduced by 50%. It may appear like a technical process, but it is not. Instead, this catalytic event has far-reaching effects on the economic as well as operational aspects of mining. The following article discusses the implications of Bitcoin halving from different perspectives and offers guidance on how to cope with these changes aimed at keeping mining profitable in the face of changing business dynamics. Table of Contents Understanding Bitcoin Halving Pre-Halving Mining Economics Immediate Impact on Miners Long-Term Trends In Mining Economics Cryptocurrency Market Dynamics Strategies For Miners Post Halving 2024 Broader Implications for the Cryptocurrency Ecosystem FAQs Conclusion Understanding Bitcoin Halving The Bitcoin halving is an event that takes place after every 210,000 blocks or around four years on the Bitcoin network. This reduces the mining reward by 50%, and therefore, brings a deflationary pressure on the new bitcoins supply. In order to constrain the total amount of bitcoins in circulation to exactly 21 million, no more than that number will ever be created. The halving plays a role in managing the bitcoin inflation rate which can be indicated by changes in supply vis-a-vis demand. The first halving for bitcoin took place on November 28th, 2012, when the block reward changed from giving out 50 bitcoins to providing only 25 BTCs. Meanwhile, the second halving happened on July 9th, 2016, whereby miners received a block reward of 12.5 bitcoins as opposed to the previous one of 25 bitcoins. Thirdly, the third halving was recorded on May 11th, 2020, after miners found only 6.25 BTCs from Bitcoin’s genesis block instead of the usual twelve and a half BTCs they were used to getting at that point in time in history. Finally, the next one will occur in approximately four years’ time (around 2024) with a reduction in block reward from 6.25 Bitcoins to 3.125 Bitcoins. When Is the Next Bitcoin Halving Event? The next BTC halving event is expected to take place in April 2024. At that time, block rewards are scheduled to decrease from 6.25 BTC to 3.125 BTC. Bitcoin halving has a great impact on mining economics and the cryptocurrency market, basically due to the fact that it influences bitcoin supply and demand, mining difficulty, and hash rate, as well as mining profitability and break-even point. In addition, it affects mining hardware and innovation, mining strategies and competition, market price, and volatility. We will now analyze these aspects further in the following sections. Mining Economics (Pre-Halving) There is a need to first understand how mining basics and block rewards are important before we go into the study of Bitcoin halving’s impact on mining economics. Mining is the process of forming new blocks on the Bitcoin blockchain; this process has been designed in such a way that it requires solving complex mathematical problems known as proof-of-work that needs a lot of computational power and energy. Proof-of-work ensures that blocks are valid and safe, while, at the same time, the network is protected from other attacks or manipulations. The first node that solves the proof-of-work for a block broadcasts it to the network and receives a reward in the form of new bitcoins and transaction fees. New bitcoins are produced by the network based on a predetermined schedule whereas transaction fees depend on market forces of demand and supply. Block Reward Composition: Miners are attracted to participate in the network and safeguard the blockchain because of the block reward. The block reward is made up of two parts: basic and fee rewards. The basic reward is a stable quantity of new bitcoins created by the network per block. Just as explained above, the basic reward is partitioned into halving mechanisms. Fee reward, on the other hand, is an unsteady payment of bitcoins tendered by users as transaction fees. Therefore, relying on supply, demand, size, and necessity, fee rewards are determined through market dynamics. The majority of the overall block reward distribution is accounted for by base rewards in terms of mining economics before halving. Base rewards stable and predictable earnings for miners despite whatever is happening in the market. Additionally, there is a positive feedback loop in which increasing demand for Bitcoin by basic rewards leads to an increase in its price making mining more profitable and attracting more miners, thus, enhancing security and value networks. However, during the pre-halving period, mining economics also had some challenges and opportunities as they experienced rising mining difficulty and falling mining profitability. Mining Difficulty: The network adjusts the mining difficulty every 2016 blocks or roughly two weeks so as to keep an average block time of 10 minutes constant. When the total computational power of a network called the hash rate increases, mining difficulty increases, while when hash rate reduces, it decreases accordingly. Despite any variations in hash rate, new bitcoins are produced at a steady pace because of the mining difficulty. The Immediate Impact on Miners The halving implies some sort of short-term economic effects for miners, including revenue, expenditure, and break-even point. Miners’ revenues come from block awards and market prices. Halving reduces the block reward, thus slashing the revenue unless the market price increases adequately to compensate for this deprivation. Miners’ costs include electricity costs, hardware costs, maintenance fees, and so on. The expenses are not changed by halving unless the mining difficulty is altered substantially. The break-even point of miners refers to the time when their revenue equals cost so that the mining business becomes profitable. The halving makes the break-even point go up which implies that miners need higher prices in order to cover their costs and make a profit. Additionally, the halving has some of its own historical examples that can provide insights and lessons for future managers and present-day players. The first halving in 2012 led to a temporary lowering of the hash rate since some miners left the scene because their activities became less profitable. However, hashing power quickly picked up again as the mining difficulty adjusted and the market price increased. Additionally, after the initial halving, there was a bull market. This happened due to a decrease in new bitcoin supply while demand went up; hence, within one year’s time, there was an 8000% rise in prices. Likewise, the second halving event that took place four years later had a similar effect: although the hash rate dropped for some time, it rose again with over 2800% increase in price over the next year. Moreover, during the third halving in 2020, there was also a slight decline in the hash rate followed by an increase of over 300% in prices. Long-Term Trends in Mining Economics The impact of Bitcoin halving on mining economics extends over the long term, bringing about indirect effects that shape the venture landscape. Mining Difficulty and Profitability Trends: The venture economics of mining have experienced a long-term increase in mining difficulty and a decrease in mining profitability. With the decline in block reward, miners now have to work harder for the same number of bitcoins. The more the miners join the network, and upgrade their machines and programs, the higher the mining difficulty. This is due to falling revenues and increasing costs which lead to lower returns on investments. Apart from these factors, other elements that determine the miners’ profitability include market price determined by supply and demand forces as well as externalities such as policies, incidents, or moods of different groups within society. Technological Innovation and Hardware Enhancement: Technological innovation and hardware improvement are other long-term trends in mining economics. In order to make up for the increase in mining difficulty—because this determines the profitability—miners have to come up with more efficient and powerful alternatives that would help them maximize the value of their mining operations. The technological innovation and hardware improvement are both caused by competition as well as cooperation among miners, and research development in the mining industry. Technological innovation and hardware improvement include the development of mining algorithms, mining software, mining protocols, and mining hardware. To say it in terms of cryptocurrency, it is a significant example of hardware improvement, a transition from CPU mining through GPU to FPGA, and finally, ASIC miners which are designed for Bitcoin. Adaptation and Diversification: A third long-term pattern in the mining industry has been the response of its participants to changes in their economic environment, which include adaptation and diversification. Amidst ever-changing profitability and mining difficulties, the miners must adapt and diversify their strategies if they are to survive and thrive under new economic realities. The adaptation and diversification of mining strategies involve choosing pools for mining, mining place, excavation apparatus, mining techniques as well as extraction markets. In a simple term, Mining Pools – groups of miners who work together to increase their chances of finding blocks by sharing their resources and rewards – are one of the best examples of this. Cryptocurrency Market Dynamics The Number of New Bitcoins Being Produced Is Reduced: Consequently, the halving lowers the rate at which Bitcoin is created, and hence, its inflation rate. The scarcity and value of bitcoins also increase due to the halving as the total number of bitcoins approaches the 21 million maximum limit. With a rise in demand for bitcoins and the price of this type of digital currency, the decrease in the supply of newly minted bitcoins resulted in deflationary pressures within the market. Price and Volatility Dynamics: Another outcome that Bitcoin halving brings to the cryptocurrency market is the increase in price and volatility of bitcoins. Halving affects bitcoins’ price and volatility directly and indirectly since it impacts mining profitability and market expectations. The immediate effect of halving on bitcoins’ price and volatility is a decrease in block reward, hence miners’ revenue, who can sell or not, depending on their break-even point and market sentiment. Halving has an indirect influence on the price and volatility of bitcoins when it impacts mining profitability, thus the hash rate or network security which may affect people’s trust in the market along with speculation. Investor Sentiments and Market Behaviour: The halving impacts investor sentiment and market behavior both directly and indirectly, as it influences market perception and expectations of halving events in the markets. Investor sentiment and market behavior are altered by this halving through a buzz created around it, making it hyped up, and attracting more attention from media outlets, public domain, and investors. This is because it affects investors’ confidence which, in turn, affects their behaviors, attitudes, and perceptions toward future outcomes of bitcoin’s supply reduction event. This event also leads to different emotional responses such as fear, greed, uncertainty, and excitement because it creates anticipation for future volatility in bitcoin prices as well as changes in supply-demand dynamics since the coin generation rate is slashed into half during this period. Strategies for Miners Post-Halving of 2024 The Bitcoin halving brings new challenges and opportunities for miners, requiring them to unveil other strategies that will allow them to navigate through the new economic environment. The miners are also given the task of evaluating diverse options and alternatives and appraising the gains and costs associated with each strategy. Miners also need to consider how risky or uncertain each of these strategies can be as well as administer them accordingly. Consequently, miners must track market trends and prices and respond through adjustment of their tactics correspondingly. : One possible post-halving strategy for miners is to continue mining bitcoins, hoping for increased prices that would compensate for the loss in block reward. This strategy rests on the assumption that halving causes supply shock while demand shoots up leading to an eventual significant increase in bitcoin prices. Continue Mining Bitcoin Such a plan suits miners with low operating costs and high efficiency in mining, as well as those with high levels of confidence by stakeholders in the mining sector. This means that it is appropriate for miners who have long-term vision and optimism regarding the future of Bitcoin. To remain competitive despite the reduction in per-block rewards after halving, : Upgrading Mining Hardware or Getting Better Mining NFT miners will need to upgrade their hardware and software while minimizing energy consumption. With a focus on operational efficiency, by optimizing energy management and participating in programs that can generate additional revenue, such as the sale of surplus energy, miners and hosters will be able to by optimizing their operations. diversify their business In 2020, the was estimated to be , which we can compare to the , comparable to the power consumption of Pakistan. Bitcoin network’s total power consumption 77.78 TWh/year 126.32 TWh of electrical energy consumed by the Bitcoin network in 2023 Energy is the biggest cost in mining. So, accessing cheap renewable energy can greatly improve profitability, especially when mining rewards are reduced. That’s why looking for cheap renewable energy can be another way of optimizing your operation. : Joining or creating a mining pool to pool resources and rewards among participants is the third possible strategy for miners post-halving. This approach assumes that the halving will raise the difficulty and spread of bitcoin mining, hence making mining pools increase the chances of finding blocks as well as ensuring stability. Join or Create Mining Pools The strategy works well for miners with substantial operational costs, average efficiency in mining, as well as some confidence in the market. It is also appropriate for miners with middle-term goals and a neutral attitude toward Bitcoin’s future development. Broader Implications for the Cryptocurrency Ecosystem The Bitcoin halving event exposes the cryptocurrency ecosystem to a wide range of considerations beyond the immediate impact on the health and value of the Bitcoin network. This broader perspective involves trade-offs and a delicate balance among various aspects, each contributing to the overall goals of the Bitcoin network. Positive Implications: The scarcity of bitcoins resulting from the halving brings about several positive effects on the well-being and value of the Bitcoin network. These include: : The reduction in the production of new bitcoins contributes to scarcity, driving up their value in the market. Increased Value : With a decreased rate of new bitcoin creation, the inflation rate is naturally lowered, enhancing the perceived store of value. Lower Inflation Rate : The heightened value and lower inflation rate make Bitcoin more appealing to a broader audience, leading to increased adoption. Growing Adoption Negative Implications: While the halving brings positive effects, it also introduces challenges that impact the overall health and value of Bitcoin: Mining Profitability: The reduced block rewards can negatively impact mining profitability, especially for miners who operate with higher costs. Network Security: Even with the positive impact on security through innovation and hardware advancements, the halving can create barriers for smaller miners, potentially compromising network security. Market Uncertainty and Volatility: The halving event introduces uncertainty and volatility into the market, affecting investor confidence and overall market stability. Decentralization and Security: The halving event plays a dual role in influencing the decentralization and security of the Bitcoin network: : The reduction in block rewards incentivizes miners to innovate and advance their hardware and software, fostering decentralization and enhancing overall network security. Cooperation among miners is promoted. Positive Impact Negative Impact: On the flip side, the halving can create entry barriers for small and new miners, potentially leading to centralization issues and making the network more susceptible to attacks and manipulation. Regulation and New Market Mechanisms: The implications of the Bitcoin halving extend to potential regulatory responses and changes in market mechanisms: The event positively influences potential regulatory responses and market shifts by enhancing the legitimacy and trustworthiness of bitcoins. This improvement facilitates the acceptance of Bitcoin into the mainstream economy. Positive Effects: Negative Effects: Conversely, the halving may intensify scrutiny from regulatory authorities, posing challenges to the future of bitcoins concerning economic viability. This increased attention from authorities could potentially lead to more stringent regulations. Frequently Asked Questions (FAQs) Q1: What is Bitcoin halving? : Bitcoin halving is an event that happens usually every four years, cutting down the reward for mining new blocks by 50% in order to control the total supply of bitcoins and manage inflation. Ans Q2: When is the next Bitcoin halving event? : The next Bitcoin halving is expected to take place in April 2024 reducing miners’ block rewards from 6.25 BTC to 3.125 BTC. Ans Q3: How does halving impact mining profitability? : Halving cuts down the block reward for miners, thus affecting their revenue directly. To remain profitable, miners may have to adjust their strategies, upgrade their hardware, or find alternative sources of income. Ans Q4: What are the long-term trends in mining economics? : Long-term trends include an increase in mining difficulty and a decline in profitability. This has made some players like miners who are innovative in terms of hardware, change strategies, and changing technologies evolve. Ans Q5: How does halving affect the cryptocurrency market? : Bitcoin halving directly hits the market reducing the rate at which new coins are created leading to enhanced scarcity. Scarcity can make bitcoins more valuable, affecting investor sentiment and market behavior as well. Ans Conclusion To sum up, Bitcoin halving has a lot of implications for the miners, market trends, and the overall cryptocurrency ecosystem. From short-term economic impacts to miners’ long-term strategies and trends, comprehension of these dynamics is crucial for maneuvering through the volatile cryptocurrency environment. Analyzing the Bitcoin halving alongside decentralization, security, and regulative responses provides insight into how the crypto market is affected by both positive and negative aspects. Since adaptation is an ongoing process in this ecosystem, the miners and investors have to come up with ideas on how they can continue thriving amidst constant changes.

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