BITCOIN MINING

Onto New Bitcoin Mining Horizons — Bitcoin Mining Landscape Overview

Data, trends, and insights in the Bitcoin mining industry

Lumerin Protocol
Lumerin Blog
Published in
3 min readFeb 22, 2024

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Key takeaways:

  • Bitcoin difficulty reaches new all-time high at 81.73T
  • Ethiopia enters Bitcoin mining partnership with China, boosting cryptocurrency’s presence in Africa
  • Finland’s rise as a crypto mining hub: renewable energy and low costs attract miners

Bitcoin Difficulty Reaches New All-Time High at 81.73T

The Bitcoin mining difficulty has surpassed 80 trillion, with a record-breaking 81.73 trillion.

This increase is driven by a rising hash rate, reaching 562.81 EH/s . The difficulty is expected to reach 100 trillion in the coming months, more than doubling in the last year.

⛏️ The automated readjustment on February 15 was estimated to raise the difficulty by 6%, pushing it to new all-time highs.

As Bitcoin approaches its halving in April, where mining rewards will be reduced from 6.25 BTC to 3.125 BTC, concerns arise about a potential decrease in hash rate.

Less efficient miners may struggle to cover costs, leading to mining rig shutdowns. Analysts suggest up to 20% of Bitcoin’s current hash rate could go offline post-halving, leaving only the most efficient rigs operational.

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Ethiopia Enters Bitcoin Mining Partnership with China, Boosting Cryptocurrency’s Presence in Africa

Ethiopia, the newest BRICS member, is forging Bitcoin mining partnerships with China, marking a significant development in the cryptocurrency industry.

In an effort to attract foreign investments, Ethiopia’s State Electricity Company launched affordable hydropower, catching the attention of Chinese Bitcoin miners.

⛏️ A recent Bloomberg report reveals that 19 out of 21 Bitcoin miners who applied for affordable hydropower in Ethiopia are from China.

The development signals China’s strategic move into Bitcoin mining in Ethiopia, potentially setting a precedent for other BRICS nations to follow suit.

If more BRICS countries enter the Bitcoin mining sector, they could emerge as formidable competitors, potentially rivaling the current Bitcoin mining hub in Texas, which is believed to account for half of the world’s Bitcoin mining activities.

Finland’s Rise as a Crypto Mining Hub: Renewable Energy and Low Costs Attract Miners

Finland is gaining traction as a promising destination for cryptocurrency mining, driven by its cool climate, abundant renewable energy, and fluctuating electricity prices.

The Nordic country’s appeal lies in its ability to efficiently cool mining rigs, a crucial factor for miners. Finland’s electricity, primarily sourced from hydro, nuclear, solar, and wind power, provides a stable and low-carbon energy supply.

Notably, periods of excess renewable energy production have led to near-zero electricity costs, attracting Bitcoin mining to the region.

The lower electricity prices in Finland significantly contribute to mining profitability.

In 2023, the country experienced its first monthly power surplus in nearly two decades, with analysts projecting further declines in prices due to the addition of 25 TWh of renewable power by 2030.

Despite the growing interest in crypto mining in Finland, potential miners must navigate tax regulations, with the Finnish Tax Administration confirming the taxation of crypto activities as capital gains or business income.

While the industry is still evolving, Finland’s renewable energy and cost efficiency make it an increasingly attractive hub for crypto mining.

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Lumerin Protocol
Lumerin Blog

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