It has been an insane epoch for Bitcoin mining. We saw a revolution in ASIC efficiency, new entrants in hardware, the Great Hashrate migration and Chinese Exodus, liquid/immersion technology became a thing, firmware maturity, mining farm management software, new pools, nation-states hashing, Pubco’s rage, and so much more.
The Hashprice and Hashrate chart is one of my favorite views to see illustrate what happened this epoch. You can see where hashrate fell off a cliff in 2021 because of the mining ban in China, but it’s continued growth since then has been nothing short of remarkable. The big winner in hashrate growth has been Texas, which some people estimate is home to 10%+ of global hashrate. Hashprice on the other hand tells us a different story. While hashrate raged upward, we saw an epic BTCUSD pullback which brought hashprice down in a very meaningful way. The two metrics were once positively correlated, but became violently inversely correlated throughout 2022. We have seen some hashprice recovery, but nothing like it was. The only thing what will propel hashprice is another mining ban and or a major increase in BTCUSD.
BTCUSD & Hashrate
During this time, we also saw many new models of ASIC’s enter the market with leaders Whatsminer and Bitmain going hard on liquid/immersion designed machines. You can see the gap in generation between the machines as we saw latest generation machines take on high voltage 5,000 watt+ power supplies to feed their beefy hashboards. Really incredible how much hashrate a single machine can now produce.
ASIC Power and Performance
Looking at all these machines in a table helps illustrate the quantity of machines and also the efficiency (Watts/ TH/s). In the table below, the machines are ranked by efficiency so you can see how machines doubled in efficiency since 2021.
Thinking through what’s to come is hard to imagine. All I can think about is that the halving is 100 days away and if price doesn’t improve in a very big way, then we will see catastrophic hashprice for small and medium miners. We’ll see mining operators with access to capital scoop up entire farms and small to middle size miner might be a thing of the past although I am sure people have said similar things in the past too! This is all in the very short term. As price corrects and everyone gets used to the new normal of a 3.25 BTC block reward we will likely see resurgence of the small to mid size miners. Anyone who survives this as small to medium scale deserves a cold beer and beefsteak.
I am excited what the future holds and I think we will see increases in transaction fees that no one can imagine, and hashrate will exceed 1,000 EH/s within 24 months. I am bullish and terrified at the same time. Stay humble and stack sats, for real this time.
