Bitcoin really become the tulip bubble?

1. bitcoin continued to fall

Bitcoin market continued to slump, a piece of some.

On Monday, bitcoin prices from $5737 all the way down, on the evening of the same day below the $5000 mark to $4883; Tuesday, bitcoin prices fell $4500 to $4482, on the evening of the same day, 24 hours down 14.41%; this morning, bitcoin lowest price hit $4060, 28196 yuan, night fell back in August of last year’s price.

In the past 3 days, bitcoin prices fell more than 30%. Now the price of bitcoin, representing the highest point in December last year (about $19800) compared to a decline of 79%.

The world’s largest encryption currency, is experiencing an avalanche of winter.

Other encryption currency, more dismal situation.

In the past day, EOS fell 13.88% to $3.77; Ethernet square fell 11.1% to $135.34; bitcoin cash also fell to $244.02, two days before the price is still around $300.

In addition, Wright coins, coins and other Gerbaud encryption currency prices also fell to varying degrees. The top ten digital currency is mostly two digit decline, according to statistics, in the 2479 encrypted currency, prices in RMB ten cents below 1400, a penny below 611. A lot of “copycat coins, air money prices close to zero, investors lose everything.

There are data that the overall market value of digital currency loss of at least $600 billion in the past week. From this year’s 1 month highs, the overall market value of digital currency erased at least 6600 billion dollars.

Or we will time stretch, you will see a bitcoin nearly a year decline has reached 76%.

By the end of 2017, bitcoin prices topped $20 thousand, at a dizzying peak in history, since 2010, seven years skyrocketed to 4 million times, however, throughout 2018, bitcoin opened the “fall” mode. As Beijing November 20th 12, compared with the beginning of the year high of $19299, bitcoin decline for the year amounted to 76%.

Bitcoin “avalanche” has caused a series of chain reaction: Ethernet, currency and other currencies have plummeted reboxetine currency, the currency market value of only encryption is $150 billion, and $850 billion at the beginning of the scale far; major U.S. GPU manufacturer NVIDIA (NVIDIA) on the recent stock price plummeted, $23 billion market value evaporated, mines by a bloodbath, in the currency price is difficult to split the cost of the case, some mines have been sold on the pounds and its wonders.

2. cost breakdown

Bitcoin mining machine with currency price languishing and suffered mine, according to the report, even some decline in the price of bitcoin has more than one machine breakdown cost price, the domestic part of the small and medium sized mines have reluctantly sold the winding machine.

A year ago the price of up to twenty-one thousand units of the vehicle, the second-hand sale price of only 1000 yuan, after some small bitcoin mine mill hill of general waste heap in the yard, even being in accordance with the price of catty to sell scrap metal.

In the words of discus, along with the changes of the industry cycle, the blockchain media will gradually return to rational, the world is still mainly in the field Chinese southwest and northwest, the Middle East is only suitable for out of the machine to the mining machine, the catty sale is a true portrayal of mine recently;

The mine will last for a period of time, an estimated 6 months; its existing silicon chip technology has reached the limit, low energy reserve two bottlenecks.

Micro-blog, WeChat in the circle of friends, bitcoin forum platform, in recent days, losing a lot of speculators are but a “even a coin, Starving people fill the land.” circle of senior game player said their assets have a loss of more than 85%, “declared bankruptcy”.

At the same time as the dollar fell, mining income cannot compensate for electricity and other mandatory spending, in November 20th, a company called hashrate investment platform said, because the ant S9 contract since November 7, 2018 to November 16, 2018 has been ten consecutive days to pay management fees and charges.

According to the “hashrate cast stress service agreement”, if ten consecutive days of contract revenue is not enough to pay management fees and charges, a force contract is automatically terminated.

The mine prospects.

3. currency prices plummeted behind the incentive

Combing the bitcoin price time line is not difficult to find, the currency price decline began on the eve of BCH. In order to win a battle, Macao and the Cong Wu Jihan use their own resources to dig for many of the original BTC (bitcoin) is switched to the BCH, which directly leads to the decrease of BTC overall stress, but also indirectly led to a decline in the price of bitcoin.

As you can see, is reached the last 10 days of the resulting BTC network is decreased by about 10%, the full cost of digging 1 BTC also fell 10% to $5000 ($4 gross electricity) ~4000 (3 gross electricity), on the basis of such costs, the big miners have full power in the futures market ahead of the BTC’s profits.

This is probably why the futures market BTC fell to $4900, if there is no profit space, bitcoin suppliers (miners) will not be willing to lower than the spot market price in advance throws in the futures market (future) bitcoin.

In the whole period is reached, BTC mining is in decline. “During the peak period, the bitcoin network has 60EH computing power, fell before there was a 52EH, and then quickly dropped to 45~47EH, now only about 40EH.” The sources said.

Is the force behind fell because of currency prices continued to decline, some miners can not cover costs due to the marginal hashrate exit, and exit is led to currency prices continue to fall, to form a vicious spiral. “Many people think that the cost to the price of bitcoin costs fell 10%, the price drop should be followed.”

It seems that currency price fell and fought off the relationship.

The author believes that the root cause of the decline is BTH long sideways, the loss of investor confidence in the bear market, the BCH bifurcation of BCH bifurcation in the war is just the fuse, BSV side regardless of economic interests, burn to attack the BCH backbone, the anti attack capability of the password to the center of the currency had suspected, currency circle belief, once fragile break, is utterly routed.

4. who is who is the fruit?

Today, although the market vulnerable situation, currency price minute smashed a low, but I think this currency price continued to sell in the market, the more bad will accelerate the touch bottom, let us from the more recent rebound.

As for its business, as encryption money mining equipment, and their inevitable fate coin circle together. In order to understand mine generation does not represent the entire currency circle of life and death, we must first look at how the mill and the coin of the physical connection.

In the bitcoin block operation, the miners finished first proof of work will get a reward, while the consensus mechanism is proof of work.

Its work is through a specific algorithm, stop the operation as the first complete proof of work, get other encryption currency bitcoin reward, the miners can through market circulation for sale, and the cost of electricity to buckle machine, to achieve profitability. The algorithm has many kinds, such as bits, bitcoin mining machine using SHA256 algorithm, BM1790 Ethash algorithm is used to mine the etheric Fang, as the world currency mining machine BM1760 using X11 algorithm.

Block chain computing device chip has experienced CPU, GPU, FPGA and ASIC in four stages, the 2013 ASIC chip available, so far, mining industry into the ASIC era, we know its leading basic is the production of ASIC chip machine.

ASIC chip is a block chain calculation tailored, calculation speed can reach TH/S level, such as 16 nm ant S9 force is 14TH/S, but the whole network involved in bitcoin mining equipment is the sum of more than 40EH/s, and 1 EH / s equal to 1 million times 1 TH/S.

It is worth mentioning that the mechanism of POW (proof of work) may face 51% is attacked, in order to solve the problem of market consensus mechanism, the emergence of POS (proof of interest) mechanism and dBFT (rights to choose accounting people) mechanism, consensus mechanism on the surface of machine independent development of the industry, but in a way that the security of encryption currency.

Thus, in fact, its survival depends on the price of money, rather than currency price depends heavily on the machine, once the machine does not work, money prices will rise accordingly.

The trend of late 5.

Although the survival of future mining machine industry will face a great challenge, because the encryption currency or possible long-term decline, mining cost is higher than the currency price, miners choose to continue mining mining machine industry currently looks The loss outweighs the gain., the prospects are grim, but just a coin mining machine industry circle, can not think of mine now don’t earn money, said the market is not good

We think, in 2014, due to the bitcoin prices, resulting in a bit, almost bankrupt, since the end of 2017, the mainstream encryption currency fell into a dog, especially bitcoin, before Morgan Stanley had a report that has been called the general large-scale mine breakeven point is $8600, while the price for more than 6500 dollars, its business income is not considered.

However, we need to be clear that once the currency prices go up, its demand will pick up, all the time, are the currency price impact mill business, rather than its business circle to cool reverse currency.

(author: Turing Turing finance, content from the chain have open platform content too “; this paper represents the views of the authors and do not represent the official position of the chain too)

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