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- As Bitcoin’s price plunged by 17.36% to $50,300, losing its trillion-dollar market cap status, miners are under significant financial pressure due to production costs.
- Only a few mining models remain profitable at current electricity costs, forcing many miners to consider selling their holdings or shutting down operations.
The Bitcoin price crash has exacerbated further as the US markets go live on Monday, August 5. As of press time, the Bitcoin price has been down 17.36%, trading at $50,3000, as BTC has lost its trillion-dollar market cap status, per the CNF update.
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As the BTC price plunges, Bitcoin miners are facing the most heat as BTC deviates further from production costs. Per the data from f2pool, considering the current BTC price and the electricity costs of $0.07 per kilowatt-hour, only the Antminer S21 Hyd, S21, Avalon A1466I, Antminer S19XP Hyd, and S19XP models are still profitable amid the market rout. Other less efficient models like Whatsminer M30S++, Antminer S19j Pro, and AvalonMiner 1246 can no longer cover their costs.
Popular crypto analyst Collin Brown noted that the declining profitability might force the miners to sell their holdings and shut down the crypto mining business. This would probably hurt the hast rate as well as the security of the Bitcoin Network.
#Bitcoin Crash Puts Miners Under Pressure! Only a Few Models Remain Profitable! ⛏️📉
With the Bitcoin price plummeting to $52,300, more and more miners are finding themselves in the red. According to f2pool, with electricity costs of $0.07 per kilowatt-hour and the current… pic.twitter.com/xWLxPdwhzg
— Collin Brown (@CollinBrownXRP) August 5, 2024
The 24-hour liquidations across the crypto market have skyrocketed above $1.16 billion, with $980 million in long liquidations. Bitcoin and Ethereum alone contribute to more than 60% of total liquidations in the market.
Gold Shows Greater Resilience Over Bitcoin
The growing chances of a US recession have led to less sell-off across asset classes on Monday. The yellow metal Gold hasn’t been spared as well! However, it has shown greater resilience than Bitcoin. While the BTC price collapsed 17-18% on Monday, the spot Gold price is down by less than 3%, per the CNF update. Thus, it shows greater resilience to the growing uncertainty in the global economy. Popular economist Peter Schiff stated:
This weekend’s Bitcoin crash is an example of why Bitcoin will never be a reserve asset for any major government or central bank. A reserve asset must have relatively low volatility. It needs to be readily sold when needed. It can’t crash more than assets it’s supposed to hedge.
Earlier this year, the gold price broke out from a 4-year consolidation period, shooting all the way past $2400 levels. Some market analysts predict That Gold reaching $3,000 is very much possible going ahead. Reports are ripe that the Federal Reserve could come to a rescue with a 50 bps rate cut even before September. Per the Crypto News Flash report, US lawmakers are proposing a Bitcoin reserve bill. However, they might have a second, considering this volatility.
Gold broke out from a 4-year consolidation and for the past 5 months has been trading within $2,400 – 2,480 price level. I believe, $3,000 is an easy target and I would not be surprised if gold goes above $3k… pic.twitter.com/SUDjChIjks
— Rashad Hajiyev (@hajiyev_rashad) August 5, 2024
