Bitcoin Mining Updates

In this edition, we discuss how Bitcoin mining fees are reaching new heights, how Montana's governor is championing the rights of crypto miners, Russia's rise in the battle for Bitcoin hashrate, and Bhutan's secret sustainable mining operations in the Himalayas. Let’s dig in👇

Bitcoin Mining Fees Are on the Rise

Bitcoin miners have been laughing all the way to the bank, earning a whopping $50 billion from BTC block rewards and fees since 2010.

According to experts at Glassnode, these miners have seen a delightful 37% increase in their profits over the years. It seems like despite some ups and downs, these miners have managed to stay in the green and make some serious dough.

Glassnode uses terms like "thermocap" and "transaction fees" to come up with these numbers. They basically added up all the block rewards and fees, multiplied them by the Bitcoin spot price, and voila! They found out that the miners' total income is 40% higher than their estimated costs.

This news puts to rest any worries about miners throwing in the towel when Bitcoin's price takes a nosedive. The mining industry keeps growing, and the Bitcoin network is reaching new heights with record-breaking difficulty and hashrate.

As you probably already know, Bitcoin transaction fees have been soaring like an eagle. Thanks to an influx of newly-created unspent transaction outputs (UTXOs), on-chain transactions have become less attractive. Those transaction fees are no joke, with the average daily fee rate hitting a staggering $6.91. While this on-chain congestion is making many reconsider whether Ordinals and BRC-20 have hindered Bitcoin’s fundamental purpose, one thing’s for certain: it’s a nice time to be a miner.

Montana Governor Enacts Bill Supporting Cryptocurrency Mining

Montana is getting crypto-friendly! The governor, Greg Gianforte, has signed a bill into law that protects the rights of cryptocurrency miners in the state. The legislation aims to prevent local governments from passing laws that would ban or restrict crypto mining. It also tackles discriminatory electrical rates for mining firms and ensures that cryptocurrencies used as a method of payment won't be taxed.

The bill was introduced as a preventive measure in response to regulatory difficulties faced by digital asset mining in other states. It seems Montana wants to create a welcoming environment for crypto miners and avoid unnecessary obstacles. The move follows similar pro-mining legislation in Arkansas, where a bill clarifying the regulation of digital asset mining was signed into law.

While Montana and other states are embracing crypto mining, the federal government is considering a different approach. The Biden administration has proposed a 30% tax on cryptocurrency miners' electricity usage as part of its FY2024 budget plan. It's an ongoing battle between state and federal authorities, but for now, at least Montana miners can breathe a little easier.

Crypto Miners Predict Russia to Claim 18% of Bitcoin Hashrate in Major Migration

There's a big migration of crypto miners about to happen, and Russia is ready to take the spotlight. According to experts, countries like the U.S. and Kazakhstan are becoming less attractive due to strict regulations, high taxes, and soaring energy costs. This could lead to a mass exodus of miners, with Russia poised to grab a significant chunk of the global Bitcoin hashrate, possibly reaching up to 18%.

As of now, Russia already accounts for around 4.7% of the global hashrate, but if things go as predicted, they could skyrocket to the top. With access to low-cost electricity, available capacity, and a solid energy infrastructure, Russia has all the right ingredients to become a major player in the crypto mining market. They might even attract a whopping 6% of the mining capacities from the U.S., Canada, China, and about half of Kazakhstan's miners.

It's not all wishful thinking either. Russian companies are ramping up their efforts in the mining sector, and the government is showing support for the industry. Although mining legislation is still in the works, Russia wants to create a favorable environment with clear rules and regulations. With the global demand for Bitcoin expected to rise, especially as traditional financial institutions show interest, Russia sees an opportunity to become a top mining destination and shake up the market.

Bhutan's Secret and Sustainable Bitcoin Mining in the Himalayas

Bhutan, the tiny kingdom nestled in the Himalayas, has been secretly mining Bitcoin for years, and they've been doing it sustainably! While other methods of crypto mining have come under fire for their energy consumption, Bhutan has been using its abundant hydroelectricity to power its mining operations.

Thanks to the ancient glaciers and rivers flowing through the country, Bhutan has access to plenty of hydroelectric power. In fact, it's already the main source of energy for most of Bhutan's population and contributes a significant portion to the country's GDP. Now, they're putting this resource to work by creating their own crypto mines. Move over, El Salvador, because Bhutan wants to join the club of countries with state-owned crypto mines.

With its small size and limited resources, Bhutan sees green crypto mining as a path to economic independence. Hydroelectricity is not only cheap but also helps keep those mining computers cool, thanks to the cool mountain air. So, in theory, Bhutan's crypto mines could have a minimal carbon footprint.

But why the secret? Well, it's not entirely clear, but it seems Bhutan is now ready to share its crypto-mining operations with the world. They're even looking for partners to expand their project and seeking investors to raise a whopping $500 million. The goal? To develop even more sustainable crypto mining in Bhutan. While neighboring giants India and China have shown skepticism toward crypto, Bhutan is embracing it and paving its own path to economic prosperity.

They may be small, but they're making big moves in the crypto world, one sustainable mine at a time.

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