The joy and sorrow of Bitcoin miners: mining machine prices soars with currency prices, worry about the plunge

 In the winter of 2017, the night in Inner Mongolia was very cold, and the outdoor temperature was below minus 20 degrees Celsius.

In a desolate "mine", Feng Sheng, a Bitcoin miner from Hangzhou, Zhejiang Province, went to bed early in a large room with a "bunk bed, sleeping seven or eight people" because there was no entertainment.

"That site is very off the beaten track. It's a half-day drive from the nearest small county town, just like the Gobi Desert. There is nothing but the site and a road." He told The Paper reporter that it was an endless wasteland.

The "mine" Feng Sheng went to was on a wasteland in Inner Mongolia. The picture is provided by the interviewee

What drove this southern guy to this cold and frozen wasteland was a hot Bitcoin market. In 2017, the price of Bitcoin rose from USD 1,000 at the beginning of the year to USD 13,000 at the end of the year, an increase of more than 10 times.

Feng Sheng is just one of many "gold diggers". Behind him is a large group of people who are eager to Bitcoin, who regard Bitcoin as "digital gold".

Starting in the second half of 2020, Bitcoin miners seem to smell the "crazy" smell of three years ago. After the price of Bitcoin broke through $10,000, it went up all the way and once broke the $40,000 mark.

Feng Sheng just graduated from university in 2017, and now he has more than 3 years of "mining" experience, during which time the Bitcoin price plummeted from nearly $20,000 in December 2017 to $3,000 in December 2008 about.

Bitcoin price trend since 2017

After experiencing the "big storms" and facing the current wave of Bitcoin's rising market, Feng Sheng told The Paper, "Mining is a long-term job. Update the mining machine, plan the site, electricity price, and electricity bill in advance. The subsequent currency price changes have little effect."

Mining is actually an activity with potential policy risks. In September 2017, the People's Bank of China and other seven departments jointly issued the "Announcement on Preventing Token Issuance Financing Risks", halting various token issuance financing activities. Domestic cryptocurrency exchanges were gradually closed, and virtual currency mining was once required to withdraw in an orderly manner. Due to its high power consumption characteristics, virtual currency mining was once included in the list of "eliminated industries" by the "Industrial Structure Adjustment Guidance Catalog (2019 version, draft for comments)" issued by the National Development and Reform Commission, but in the official draft "Escaped".

Crazy Bitcoin Put Mining Chips in Hot Sales and Potential Risks

Since the beginning of 2021, Bitcoin continues to gain momentum. On January 6, the price of a Bitcoin exceeded 35,000 U.S. dollars. It took only half a month from breaking the 20,000 U.S. dollar mark to 30,000 U.S. dollars. Under the explosion of mining demand, the production capacity of mining machines has also encountered challenges. At the same time, the production capacity of upstream chip foundries has begun to come under pressure, especially the demand for 5G and consumer electronics has also grown simultaneously.

Looking back at the past 2020, Bitcoin's growth rate is close to 350%. Driven by the hot market, the mining income of miners has risen accordingly, which in turn promotes a surge in demand for mining machines. Major mining companies have purchased more high-power mining machines. Mining companies hope to take advantage of the current high currency prices and the increasing difficulty of mining to obtain more stable mining revenue by increasing computing power.

What are Filecoin and Bitcoin

 A manufacturer of ipfs FireRaytheon believes that the most famous NFT trading market uses IPFS and Filecoin to support its network...

 In fact, Bitcoin was not popular at first. Many people think this is a bubble. However, after more than a decade of downturn, Bitcoin has become a leading digital currency. Many people began to regret not mining Bitcoin. Then, document currency will be introduced. It is called the second type of Bitcoin. As a symbol of the IPFS storage system, it is even more practical than Bitcoin.

The development trends of Bitcoin and fil are still very different. However, due to the relatively high feasibility of the IPFS project, the future development trend cannot be underestimated, and its prospects can also be realized.

Bitcoin was born more than ten years ago. At this time, the exchange rate has exceeded 10,000 times. At present, the document currency exchange rate is still difficult to exceed Bitcoin. However, the IPF project has only six years of history and was launched only a few months ago. In terms of time value, there is still a lot of room for growth and huge opportunities.

The Internet is rapidly developing into Web3.0. The iterative technology of IPFS distributed memory is the foreplay of Web3.0. How can fil currency (a virtual currency based on IPFS) compete with Bitcoin in the future?

In addition, with the release of the new economic model, almost all mining companies invested in the first half of this year. This book is highly profitable, but it is either hypothetical or closed. In short, it cannot be removed. In the early stage of the filecoin network, the proportion of computing power added to the terminal capacity every day was too high, requiring a lot of funds to enter the system, and then to enter the path system, following the traditional model, especially in the early stage, when the market supply and demand are out of balance, it is particularly easy to cause prices And changes in value, leading to currency shortages and currency prices.

Large investment institutions in the world

As we all know, the goal of these institutions is to make a profit. There is no doubt that a group of institutions represented by Sequoia Capital have been strongly confirmed by filecoin. This is a goal with the greatest profit potential. In particular, many investors believe that the distributed network of IPFS will disrupt HTTP and create the next generation of new value Internet Web3.0. In fact, there were only a few tokens in circulation in the early filecoins. Only from the perspective of the market, a lot of resources are not needed to promote the rise of currency prices. Obviously, these giants have this kind of capital capacity, so the rise in the price of filecoin has a strong capital base.

Why FIL is the most valuable currency

Bitcoin is just a digital asset. Its characteristics affect its limits. It can be said that the maximum value of Bitcoin is just a consensus. With the advent of the 5g era, many companies, governments, and eventually their data storage needs will be transformed into IPFS networks with better technology. Therefore, the value-added of filecoin even exceeds that of Bitcoin, which is no fantasy. Therefore, we can seize the pulse of time, enter the lockdown zone, and participate according to our specific circumstances, so that we can have a better future.

As the value of IPFS is proven, more and more Internet companies and blockchain companies use IPFS for storage and R&D. Therefore, these companies are obliged to purchase a large amount of filecoin to pay for the miners' fees. The currency price will rise as the price rises, and the amount of fees will also be released. The global data center has deepened the national recognition of the document estimation pricing model, and provided document estimation pricing within three years of operation of the filecoin network.

Will Filecoin surpass Ethereum or even Bitcoin?

With the gradual development, stability and security of the Filecoin network, many users in the traditional storage market have also chosen lower-cost, safer, and more efficient distributed storage services IPFSs, which ultimately illuminates the future storage market. Filecoin will become the hottest digital gold in the future.

How to profit from virtual currencies

 The appearance of virtual currencies is inseparable from trading, which will brings about price differences. 

The blockchain sector keeps hot. Virtual currencies have developed over the past few years and Bitcoin’s great success has now formed a large market. In fact, there are more than 1,300 types of virtual currencies in the world. The currency recognized by the public on the market has also tended to a stable state. Although Bitcoin is still the leader in the TOP throne, there are many other virtual currencies that have also shown a hot trend.

The People's Bank of China wants to tighten up the regulation and management of virtual currencies in online games to prevent virtual currencies from impacting the real economic and financial order. It is necessary to strictly limit the total amount of virtual currency issued by online game business units and the purchase amount of individual online game consumers; strictly distinguish between virtual transactions and physical transactions in e-commerce. Virtual currency issued by online game business units cannot be used to purchase physical products. It can be used to purchase virtual products and services such as online games provided by itself.

But no matter which side is correct, as a virtual currency, its existence form has an irreconcilable conflict with the legal sovereign currency of various countries. In addition, the current leading bitcoin price plummets, and it will eventually inevitably end in decline. The editor of Juhui Foreign Exchange thinks that instead of going on a hopeless road, it is better to choose a reliable investment method.

How to Trade BTC? Demystifying money-making channels of virtual currencies

 Digital currency exchange refers to a platform for matching transactions between digital currencies, digital currencies and legal currencies, and is the main place for the circulation and price determination of encrypted digital currencies. Compared with traditional stock exchanges, in addition to matching transactions, digital currency exchanges also assume the roles of market makers and investment banks. The investment bank role of the exchange provides services such as issuance and underwriting of digital currencies, from which the exchange collects currency listing fees, or collects deposits in the form of voting by the exchange community. This article analyzes the profit model of digital currency exchanges by selecting major global digital currency exchanges such as Huobi, OK, Binance, ZB, Gate, and ZBG.

Digital currency exchange refers to a platform for matching transactions between digital currencies, digital currencies and legal currencies, and is the main place for the circulation and price determination of encrypted digital currencies.

Compared with traditional stock exchanges, in addition to matching transactions, digital currency exchanges also assume the roles of market makers and investment banks. The role of the exchange's market maker can increase the liquidity of the market, and the exchange will earn the trading price difference from it. The investment bank role of the exchange provides services such as issuance and underwriting of digital currencies, from which the exchange collects currency listing fees, or collects deposits in the form of voting by the exchange community.

At present, most digital currency exchanges are centralized exchanges, which can be divided into legal currency exchanges, currency exchanges, and futures exchanges. Decentralized exchanges are exchanges that aim at the many drawbacks of centralized exchanges and the practice of decentralized consensus on the blockchain.

Three types of centralized exchanges for virtual currencies:

Fiat exchange

Legal currency exchanges allow users to convert legal currency into digital currency. Due to local banking regulatory regulations, the types of legal currency that can be traded on general legal currency exchanges are relatively limited. At present, there are 23 digital exchanges in the world that open legal currency transactions and have transaction amounts. There are two types of fiat currency exchanges:

Virtual Currencies Fell by 60%, "Torment" Young Coin Adventurers

Memorabilia of virtual currency regulation

September 4, 2017

Seven departments including the Central Bank and the Office of Cyberspace Affairs issued a joint announcement to stop the issuance of tokens (ICO), clean up and rectify the ICO platform, and organize the withdrawal of ICO tokens.

September 14, 2017

Bitcoin China announced the cessation of Bitcoin and other transactions. The platform will stop new user registration on September 14 and will stop all digital asset transactions on September 30.

September 15, 2017

Beijing regulators announced the closure of virtual currency exchanges such as Bitcoin.

January 12, 2018

The China Internet Finance Association issued an announcement reminding consumers and investors to prevent ICO activities in disguise. It also stated that Xunlei "Lianke" actually replaced the legal currency payment obligation for the services contributed by participants with "Lianke", which is essentially One kind of financing is ICO in disguise.

January 26, 2018

The China Internet Finance Association issued a document reminding the risks of overseas ICO and "virtual currency" transactions. The risk reminder said that due to the general lack of regulations in the world, current overseas trading platforms also have hidden risks such as system security, market manipulation and money laundering.

March 9, 2018

Huobi makes a final farewell to RMB trading users in the form of an announcement. We have decided to officially delist all RMB-to-digital asset transactions at 24:00 on October 31.

March 28, 2018

Fan Yifei, deputy governor of the People's Bank of China, stated at the 2018 National Currency, Gold and Silver Work Conference that this year, internal management and external supervision will be strictly strengthened, and various types of virtual currencies will be rectified and cleaned up.

Following Pace of Wall Street, British Rice Bank Bans Virtual Currency Buying with Credit Cards

Credit card is a popular electronic payment method. When buying virtual currency such as Bitcoin (Bitcoin), people often use credit card to pay. However, some banks have begun to examine the risks, and some have even banned the use of credit cards to purchase Bitcoin.

British Rice Bank Group announced that all its banks have stopped using credit cards to purchase virtual currency, over worries about the continued decline in value will put customers at huge asset losses.

The price of Bitcoin has dropped from a peak of over US$19,000 to approximately US$8,000 recently. Some banks worry that customers will suffer huge asset losses and prohibit the use of credit cards for purchases.

According to the US CNBC report, Rice Bank Group announced this measure on Monday. Its subsidiary Rice Bank, Bank of Scotland, Halifax and credit card company MBNA will not accept credit card purchases of virtual currency from today (February 5, local time).