If small miners go bankrupt during the epidemic, will it exacerbate the monopoly of the mining market?

Nowadays, the era when one person with only a PC can mine is long gone.

As the price of Bitcoin continues to rise, the difficulty of mining has also increased, and the cryptocurrency mining industry has been dominated by mining groups with specialized computer chips and high processing power - such as Bitmain.

The recent turmoil in the cryptocurrency market has highlighted another area of ​​concern: cryptocurrency miners, as miners are hit hardest by the falling price of Bitcoin, making their profits increasingly slim.

According to data disclosed by mining company F2Pool, when the price of Bitcoin fell to $3,600 on March 12, the computing power of the entire Bitcoin network "did not shrink significantly."

But the company further said: "We saw a downward trend in Bitcoin mining difficulty changes throughout the weekend, which means that some miners are shutting down their mining equipment. The mining industry, as always, is an industry where the fittest survive, and miners need new mining equipment, cheaper electricity, and lower rents."

Now, small mining companies that cannot afford the high costs are shutting down their operations, which may lead to large mining companies monopolizing the Bitcoin mining industry. However, a question arises: For those smaller Bitcoin miners, is it possible to make a profit if they continue to mine?

At the time of writing, according to BTC.com data, the mining difficulty is 16.55 T (as shown above), which will make it difficult for small miners to continue operating.

Bitcoin miner and cryptocurrency investor Kris said in a recent podcast that it is difficult for "small fish" to survive in the cryptocurrency industry today. Kris said, "If you see the difficulty of Bitcoin mining has reached 16.55 T, it's really crazy. Even though the global economy seems to be in chaos, in the Bitcoin mining industry, you will find that competition is still very fierce. Now there is no room for the "small fish", and the whales are breaking in, and there may even be some hostile takeovers."

From this perspective, it seems that only large miners can withstand the impact of the market decline during the current COVID-19 epidemic. But is this really the case? Will we really see large miners use their huge power to monopolize the market on a large scale?

Regarding these issues, Kris believes that the situation of large miners may not be as strong as people think. He pointed out that everyone at every level will be affected by the new coronavirus epidemic.

Kirs further said: "Large-scale mining farms must be living investments, right? But what most people don't know is that these people are losing money while mining... When you have a large-scale mining facility of 5MW to 10MW, and you don't want to sell the mined Bitcoin immediately because the price is too low, you have no choice but to hoard the coins." (ChainDD)