By Leah Hutton (Luxembourg)
Halving event is approaching and analysts are expecting something big from this event. Most of the crypto experts are taking it positive for the crypto growth and price will be surged after halving. The executive partner at ECOS, Ilya Goldberg, believes that halving is a green sign for the crypto growth than you actually think.
The laymen perceive halving as the reduction of rewards into half. It occurs every four years. At the start, the reward was standing at 50 BTC which reduced to 25 and then to 12.5BTC. Now, it is going to happen in May 2020 because 210,000 blocks have been completed. And the rewards will be reduced to 6.25 BTC.
Companies and investors reaction to halving
Investors are seeing it through another angle. It is said that bitcoin will become more functional and operation after the BTC reduction and the charges on the network will decrease. These factors will trigger the BTC adoption on a wider scale. However, there may be a bad environment for small level miners.
Most of the mining ASICS will be dysfunctional and will become obsolete. The machines will not be able to drive the profit from the mining as electricity costs will increase and rewards decrease. Almost 80% mining hardware will become obsolete and competition will automatically decrease.
Also read:The new miners will gain popularity due to their efficiency powers and low power costs. This will lead to the price increase of new miners in the markets.
Ilya Goldberg of ECOS
According to Goldberg:
Here at Ecos we have analyzed the feasibility of new hardware and its projected profitability after the block reward is halved. The conclusion is the following: now is the most opportune time to invest into such ASICs as Bitmain Antminer T17, or other models rated at 38 — 40TH or higher that are perfectly capable of generating enough profit to both cover the power bill and generate a significant profit.
He further added:
We have charted the ROI for these miners for various BTC price projections and baseline equipment cost. We learned that the higher the equipment costs, the longer the payback period. We have also factored in the possibility of a situation similar to 2017, when a cascading increase in demand for new generation miners caused scarcity on the market and drove the prices even higher.
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