Crypto Miners Shutting off, Despite Network Growth.
As the old adage states, “what goes up, must come down” and now it appears the network hashrates of many popular cryptocurrencies, Including Bitcoin, Litecoin and Ethereum have finally realised the cost of production for many and are beginning to trend down.
These figures are followed by a somewhat telling report from AMD, who say their GPUs, which are very popular for mining, have seen ‘negligible’ sales in Q3 of 2018 and following a somewhat lacklustre Q2 report where AMD as well as Nvidia, another manufacturer have warned investors to expect lower sales of GPUs due to the downturn in the crypto currency markets.
“The quarter-over-quarter decline was primarily related to lower revenue from GPU products in the blockchain market.” -AMD
For a time it seemed to be the only metric still growing, due in part to the fact it takes longer for hashrate to adjust to market conditions and new ASIC miners as well as GPUs need to be built and shipped.
As of September the Bitcoin hashrate had begun to plateau and as of October had started to fall, peaking at just over 55E (Exahash).
As for Litecoin and Etherum, they began to turn down earlier in the year, most likely due to a greater fall in price, resulting in equilibrium being reached sooner.
Despite price, many other statistics appear to be holding or even growing including: Block sizes, Transactions and Active Addresses on the network. While it seems many speculators were caught up in the bull run of 2017 it would appear the core audience are still here actively using these networks and based on numerous statistics Litecoin usage is still up around 9x since Jan 2017 indicating many new people have entered the space and have stuck around despite market sentiment.
It is of course, not the first time this has happened and it will more than likely not be the last. Cryptocurrencies become easy targets when they are trending down, due to their transparency and openness, more so than any other monetary system which we have had previously.
