Mining market experts of bitcoin and cryptocurrencies analyzed the situation of Russian miners within the war scenario. – said Eliza Gkritsi.
Mining in Russia is very strong
Russia is the third largest BTC mining country, which accounts for about 11% of all hashrate on the Bitcoin network, according to this mining map. This increases the importance of events that can bring positive or negative effects to the industry in the country.know more: 1 billion reais in Bitcoin mining machines seizedOn a war scenario and global economic sanctionsmany eyes of cryptocurrency enthusiasts are focused on the russian territoryattentive to what could happen in the coming days, months or even years, as a consequence of all these events. Coindesk reporter, analyst and crypto mining expert Eliza Gkritsi gave an analysis of what we can expect.
Positive scenario that could get bad soon
According to Sergey Aresovco-founder of Russian mining company BitClusterO scenario is still very positive for Russian miners mainly due to the fall in the value of the ruble as a consequence of the war and sanctions. With the local currency (RUB) being worth less, the Bitcoin becomes more valuable in the region for miners living on the Russian ruble. So when you find a new block and receive the protocol rewards, your profit is enhanced at first, favoring the return on investment initial, made with a stronger coin. In addition, Sergey also pointed to the Energy supply and Construction Materials relatively cheap in russia. What favors the cost reduction fixed assets and also collaborates to increase profit from the activity. But not everything is rosy in the mining industry.
Forecasts of future problems
“Definitely, we will not see any investment in new sites or hosting for bitcoin mining in the region of anyone outside of Russia,” Rusinovich said. this one more time raises concerns about the centralization of the network and the dwindling range of options for geographic diversification of computing powerhe said. Another problem that awaits on the horizon is related to supply chains (supply chain) interrupted by economic sanctions against the Russian government and, in some cases, against the entire population. Several governments and also private companies are interrupting trade agreements and the supply of general products and services to Russia, with a punitive intention, using the economy as a weapon of war to try to accelerate the end of the conflicts arising from the invasion of Ukraine. With this, it is very likely that the equipment price necessary for mine bitcoin and other cryptocurrencies undergo large increases, due to the difficulty of access and shortage of supply what should happen in the country. Those who stay in Russia “may face shortages of spare parts and logistical difficulties” because of the sanctions, Arestov said. “(…) but specialized chips for mining cryptocurrencies, known as application-specific integrated circuits (ASICs), can still be bought from China,” countered David Carlisle – director of policy and regulatory affairs at blockchain analytics firm Elliptic. The main manufacturers of ASICs remain in China, which has not imposed sanctions on Russia. Rusinovich predicted a increase in tariffs for air shipments of hardwarenow that Russian airlines have banned European airlines from flying to Russia.
How can these mining problems impact the market?
Adding these economic factors together, a few more regulatory uncertainties about the direction the government will take in relation to the war and also to cryptocurrencies, the network can suffer negative impact in the short and medium term.Source: https://ycharts.com/indicators/bitcoin_network_hash_rateIt is possible to see a large withdrawal of investments mining in Russia, causing stagnation or fall of the participation of hashrate in the country. With more expensive equipment, the sale of mined BTCs suffers greater pressure, for general costs. If the scenario really becomes unsustainable, a miners escape to other friendlier countries would also result in fall in decentralization network consensus, concentrating the hashrate in other regions.In any case, Bitcoin has proven resilient to local negative effects against mining.What do you think? Leave your opinion in the comments and follow the crypto market news on social media | Telegram | twitter | Facebook | Instagram | of Thegarret.Read more:Buy Bitcoin on Coinext
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