Report: Bitcoin Price Drop Wipes-out 2.3 Million S9 Miners – Is it in a Death Spiral?

coronavirus bitcoin

The world is currently facing a severe crisis as Coronavirus has spread violently across the entire world. The drop in the price of assets and lock-down in affecting the production cost of things as well. According to reports, the drop in Bitcoin prices is causing wild-scale shutdown in Bitcoin as well.

In research report by Securities Daily’s Xing Meng, Chinese miners are witnessing large-scale shut-down. An industry insider told the Securities Daily reporter,

According to F2pool’s calculation data of the entire network, roughly 2.3 million Ants S9 have been shut down from March 10 to now (reported on 22nd March)

total hash rate of bitcoins
Total Hash-Rate of Bitcoin (Source)

The total Hash Rate for mining jumps above 100 Th/s as the price saw an uptrend to $6000 last week. Nevertheless, it has dropped to $5800-$5900 as the world awakens to worse realities of the spread on Monday. Globally, equity markets are under facing likely to face huge liquidity crisis. If the correlation with the stocks markets continues, the crypto-markets are looking to a downfall as well.

To the Point of Death

As reported earlier on CoinGape, the Bitcoin price is currently threatening to drop below the break-even price of miners. The older S9 miners are powered by 16 nm chips and have been dominating the markets since 2016. However, these systems are now becoming obsolete.

The break-even cost of S17 miners are substantially lower than the older S9 models. The S17 miners are powered by 7 nm chips, which are highly cost effective. According to the report by Secuties Daily, a fall below $2,600 – the break-even cost of S17 miners, will be a huge shock for the industry. However, some of large-scale miners are likely to stay in business.

Moreover, the adjustment in Bitcoin’s Difficulty will also benefit the large-scale miners. Hence, the case for death of the entire mining industry still arguments against it. However, the losses to medium and small scale miners will be huge.

China, the originating country of the Coronavirus now returning to normalcy as it looks like the spread has been contained. Moreover, as it dominates the Bitcoin mining industry it is less likely to be affected due to geographical reason. However, the dropping prices and miner capitulations are likely to accelerate the sell-off as well.

Do you think the crypto-markets will be able to hold-off against the marco-drop in asset prices? Please share your views with us.