William: Why are the miners so confident?

Editor's note: This article comes from: William Chat (ID: William1913), author: William Chen.

Yesterday morning I woke up and saw a news push saying that the difficulty of Bitcoin mining has hit a new record high, 13.8T. And it is predicted that it will be even higher in two weeks, reaching 14.71T. I opened the query website and checked it out, and it was indeed like this:

With the market price unchanged, there are still more mining machines coming online. I did a simple calculation and found that this is actually logical. Because according to the current price, the mining situation is like this:

Shenma M30S, Antminer S17 and Avalon 1166 are all relatively new mining machines. The table shows that, based on the electricity fee of $0.05, which is more than 30 cents, they will recover their investment in an average of one to one and a half years. (Ignore the number of days to recover the investment in the table, the market price is fluctuating and not fixed) If the electricity price of many miners I know is lower than this level, then their recovery period is actually shorter. So although the current price is not good, for miners, buying the latest mining machine for mining is still a good business.

There is actually a very critical point here that the miners cannot be unaware of, which is that the income will be halved in five months.

If the miners are not optimistic about the market after the halving, they may not install machines at this time. After all, as the halving approaches, the difficulty increases and the payback period may be much longer than they expected. However, they are still installing new machines, which shows that they are optimistic about the future market.

So despite the increasingly frozen market, we can still conclude that miners are optimistic about the halving. (Perhaps they just think that it is the S9 that shuts down, not them).

However, compared to the miners’ optimistic expectations, both market sentiment and technical indicators are very pessimistic, and basically give a “strong sell” signal:

We don’t know what supports the miners’ optimism. Perhaps the miners just feel that the current situation is very similar to the beginning of 2019, when the entire market was also very desperate. At that time, whether it was buying bottom-fishing mining machines or continuing to expand mining farms, they would get very large returns in the next few months.

However, what is different between this year and last year is that miners seem to have added leverage. According to the information I have gathered, it is not uncommon for miners to add leverage this year, and they are adding real money, which is very impolite.

So many people are worried that if leverage continues to increase, the price of the currency may not necessarily improve. If it really is halved, wouldn’t it be a huge mining disaster?

Actually, I don’t know whether it was a mining accident or not. But I know this:

The miner's car looks like this:

Your car looks like this:

So don’t worry about the miners.

Hahahaha.