Bitcoin Miners Share Optimism as Second Bitcoin Halving Approaches

The second so-called Bitcoin “block halving” is fast approaching. This week, as three-quarters of all bitcoins have been mined, the block subsidy will decrease from 25 bitcoins per block to 12.5. A key event in Bitcoin's history, eagerly anticipated by some – and perhaps somewhat feared by others.

More than anyone else, Bitcoin miners stand to be affected by the event: producing blocks is their business and the block reward presents the major chunk of their revenue. Having spoken to BTCC COO, Samson Mow, and BitFury CEO, Valery Vavilov, last weekBitcoin Magazine reached out to other miners to see how they are preparing for the upcoming halving.

What do AntPool's Jihan Wu, Genesis Mining's Marco Krohn, HaoBTC's Eric Mu and Slush Pool's Marek Palatinus expect of the halving?


Much like BTCC's Mow and BitFury's Vavilov, all miners Bitcoin Magazinespoke with are approaching the upcoming halving with a general sense of optimism. While a halving of the subsidy cuts directly into their revenue stream, miners recognize this is key to Bitcoin's value proposition.

Wu is the co-founder of Chinese ASIC manufacturer, Bitmain, which also runs AntPool, the second largest mining pool in the world, controlling some 20 percent of total hash power. Speaking to Bitcoin Magazine, Wu said he expects the Bitcoin price to rise as a result of the halving.

“Bitcoin's monetary policy is not perfect but it delivers on its promise. Delivering promise is very difficult for a monetary bureau or a central bank,” Wu said. “I believe the halving will have a very positive impact as the new supply will be much less than before. Logical analysis does not necessarily lead to a doubling-of-price conclusion but I do see the anticipation of the market having a positive impact on the price.”

Mu, CMO at Chinese mining pool and wallet service HaoBTC, shared Wu's optimism. Mu, who's HaoBTC accounts for some 3 percent of total hash power, agreed that Bitcoin's limited supply is a major selling point for the cryptographic currency and believes the future for the mining landscape is generally bright.

Mu said:

“A major factor that got me attracted to Bitcoin is the inflexibility of its monetary supply. The finite supply and halving-every-four-years scheme led me to believe that it was less subject to human fiddling, at least not controlled by a small group of political elites to the same extent as most fiat currencies in today's world.”

He added:

“I recently spent a couple weeks in western China, mostly Sichuan and Xinjiang. I sense there is strong optimism, both based on what my own company is planning and what I saw others are doing. I haven’t heard anyone telling me that they are divesting because of the halving. Of course, I haven’t ‒ and couldn't have ‒ talked with everyone in the industry, so can’t eliminate the possibility that I missed the larger picture.”

Krohn, CFO and co-founder of major cloud mining service Genesis Mining, shared the general sense of optimism as well, although he was more skeptical of the assumption that the price will continue to rise as a result of the subsidy halving.

“The normal argument goes like this: Given constant demand for Bitcoin and the fact that the supply for Bitcoin is halving, the price should go up,” Krohn said. “While the argument is correct at the first glance, it neglects that the event is known to every participant and thus will be 'priced in.' Speculators will start buying Bitcoin before the event takes place and thus will anticipate the outcome. Some of the price increase we have seen since the end of May, might be attributed to that.”


Although general sentiment under the miners was positive, others have warned about risks relating to the halving. Coinbase CEO Brian Armstrong in particular, but also some Bitcoin Core developers and other experts are concerned the subsidy halving might cause some miners to shut down their machines due to a lack of revenue. 


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