Will Older Miners Still Be Effective in 2024?

After the Bitcoin halving, many miners will become unprofitable, but not all will be unprofitable enough to turn off immediately. Usually, there is a period when miners will accumulate enough Bitcoin and hold onto it in hopes that the price will increase, allowing them to sell those Bitcoins to cover their costs. However, this strategy doesn't always work because it's difficult to predict how long the price will remain at its current level, and it may never go up.

Market participants who have updated their equipment to newer models will be in a better position. However, it depends on the cost at which they update that equipment because, ultimately, Bitcoin mining is a business like any other. If you spend $1,000 to make $300 and then spend another thousand dollars to continue making $300, it doesn't provide any benefit.

Therefore, what's crucial is to ensure that if you have all the necessary equipment, it runs as long as possible at a low power cost until it actually fails.

According to Sergii Gerasymovych, the CEO of EZ Blockchain, older mining equipment will not likely be effective in 2024 or any time in the future. During his webinar on Bitcoin Halving 2024, Sergii was candid about the fate of older mining equipment and how the Bitcoin halving will affect them.

"Unfortunately, the Bull Run of 2021 to 2022 drove the cost of crypto mining equipment to insanity. Many people did buy the cryptocurrency mining equipment at the top, which means that those players are still sitting with that equipment. They have not sold it because that equipment has not made any money yet and is far from making any money, and that's a big issue. They will not survive the halving if they don't throw more capital, small or big."

Cooling

Crypto mining is a highly energy-intensive process, and as a result, it generates a significant amount of heat. The mining rigs emit a substantial amount of heat that can damage their components and must, therefore, be effectively managed. Primarily, miners choose between air cooling and immersion cooling technologies.

Air Cooling Technology

Air cooling is the most commonly used and most affordable cooling technology in crypto mining. In this method, miners use strategically placed high-velocity fans to circulate air around their miners. The fans ensure that the hot air dissipated from the mining hardware is blown away while drawing in cold air to cool the miners. These cooling systems are cheap to install and maintain, although they are inefficient for large-scale mining operations with many mining rigs.

Immersion Cooling Technology

Immersion cooling provides the efficiency every investor needs for large-scale crypto mining. This cooling method completely submerges the mining equipment in a thermally conductive but electrically non-conductive fluid. Although the initial cost of the immersion cooling infrastructure is higher compared to air cooling, it provides unmatched efficiency in cooling and additional benefits.

Increased miner hash rate

100% noise reduction because there are no rotating miner fans Protects mining equipment from dust and debris Extended equipment lifespan Saves the energy used in running fans

Self Mining vs Hosted Mining

Self Mining

In its simplest form, self-mining involves assembling your own miners in a private space for Bitcoin mining. You're responsible for developing all the necessary infrastructure, including the floor space, sourcing the miners, power, cooling infrastructure, and handling all mining operations.

However, due to the complexity of Bitcoin mining, self-mining comes with drawbacks.

High power rates - solo miners lack the advantage of economies of scale and are thus unable to negotiate favorable power rates with energy companies. Limited infrastructure - self-miners lack the resources to build the infrastructure required for crypto mining. Dealing with mining complexities - solo miners are responsible for their mining setup. They must handle all the complexities, including equipment breakdown, dealing with noise, and maintaining the appropriate uptime and internet bandwidth.

Hosted Mining

Hosted mining, on the other hand, refers to mining cryptocurrency from a rented space. Miners contract a hosting service company to handle all their mining operations for a fee. The hosting service provides power, cabinets, racks, internet, cooling, and all operational aspects.

With a hosting service, miners are guaranteed:

Competitive power prices - mining hosting companies can negotiate better energy rates with utility companies. As a result, they provide affordable hosting packages to their clients. Cooling infrastructure - most hosting services like EZ Blockchain provide clients with different cooling infrastructure. You can choose between air and immersion cooling for your miners. Professional team - with a hosting service, mining rigs are left in the hands of professional teams, including experienced engineers and technical staff. They assemble the miners for you and handle all technical issues. No heat and noise pollution - mining hosting companies situate their data centers away from residential areas. As such, you don't have to worry about your mining operations being a nuisance in your neighborhood.