Good Evening! Here at BitOoda we like to share color on the verticals in which we operate, and this weekly Bitcoin mining report is just that.
One of the main on-chain metrics we look at is hash-rate/difficulty. Over the past week we can see that difficulty increased ~2% from 12.72T to 12.97T. So far this year BTC difficulty has seen a significant uptrend, with a gain of 120% from January. This can largely be seen by the price appreciation as well as access to cheap power and newer machines.
Earlier this year, we made it a priority to create financial products that help miners hedge against different risks such as difficulty. One of our products, BitOoda Difficulty™ swap let’s clients do just that. A mining client of ours was fortunate enough to trade the difficulty swap at 6.7T and ended up settling at 7.4T as described in this post. As we were getting into the wet season in Sichuan province, China our client anticipated that hash-rate/difficulty would explode and wanted to protect against this.
We advise all our mining clients to be very thoughtful about price risk, difficulty risk and electricity risk as these factors are the basis to whether your operation is profitable or not.
In Bitcoin, we hear that block times are an average of 10 minutes, now that would be true in a perfect scenario, but this is not perfect. Looking at the data, avg. block time since the first difficulty change on January 13th was 9 minutes and 38 seconds. As difficulty keeps increasing, this number will always be less than 10 minutes.
Given the impending halving in 2020, if blocks continue to be produced faster than 10 minutes, we can expect the halving to approach faster than expected.
With BitOoda’s Mining Services initiative, we provide consulting on all aspects of your mining business from hedging and hardware sales to co-location and financial modeling. If you have any questions or would like to learn about how we can help your business, feel free to reach out to firstname.lastname@example.org