On-Chain Transaction Fees Increase

In what may be a sign of things to come, on-chain transaction fees have risen to noticeable levels for the first time since June. With fees accounting for ~7% of the total block reward.

A rise in fees not only provides a boost in revenue for Bitcoin miners, but it is a direct signal of higher demand for transactions on the Bitcoin blockchain. Heightened demand is often indicative of a bull market. Notice the fee frenzy of late 2020, which ultimately led way to the bull market of 2021, at which point fees rose even more.

Miner Revenue on the Rise

Hashprice recently hit as high as $0.05/Th/Day – and has now settled at $-0.048. On a month-over-month basis, Hashprice is up nearly 20%.

With a second consecutive positive difficulty adjustment set to take place this week, we can confidently say that the “miner capitulation” induced by April’s halving is complete. Congratulations to all the miners who survived the halving – brighter days are forthcoming.

Mining Economics 

The rise in Hashprice is creating far more favorable economics for Bitcoin miners – here’s a glimpse of some of Blockware’s current offerings.

Our deal of the week is The Antminer S19 XP Hydro – which we are selling for $11.5/T. At the current Hashprice, this machine has an APY of ~34% which is a payback period of roughly 3 years.

However…

…the picture changes drastically if BTC begins to take off. At a BTC price of $150,000 (assuming a 2-to-1 increase in difficulty), the APY for an S19 XP Hydro eclipses 100%.

The lower upfront cost of this machine makes the economics increasingly more attractive – in relative and absolute terms — as the BTC price rises.

Here’s a more detailed look at how the returns on Bitcoin mining change as the BTC price changes.

However, a point of note is that this is based on purchasing mining hardware at current prices. During a BTC bull market, ASIC prices will likely increase – so it’s important to act now and secure low priced hardware while you can.

To learn more about Bitcoin mining with Blockware, fill out this form on our website.

The table below provides a full pricing list for all the ASICs available through Blockware at this time. For those seeking to purchase ASICs in bulk (with or without hosting), contact sales@blockwaresolutions.com or reach out here.

If you’re looking to purchase individual machines, you can use our self-service marketplace to pay with BTC and start mining immediately!

Check out our latest report

In case you missed it, we published our ‘Q4 Market Update’ last Friday – discussing all things liquidity, rates, and Bitcoin. You can read that here.

All content is for informational purposes only. This Blockware Intelligence Newsletter is of general nature and does consider or address any individual circumstances and is not investment advice, nor should it be construed in any way as tax, accounting, legal, business, financial or regulatory advice. You should seek independent legal and financial advice, including advice as to tax consequences, before making any investment decision.