Noti Hash is CryptoNoticias’ Bitcoin mining newsletter. It is published on our website every two weeks, being today, Thursday, December 2, 2021, the ninth edition to be published, at block 712.306.
While in the last two weeks the Bitcoin mining industry continued to consolidate globally, CriptoNoticias was in El Salvador to verify the reality of the much promoted mining with volcanoes.
After a first week full of events, conferences and social engagements, we set about touring other regions of El Salvador, including Conchagua, in the department of La Unión, in the western coastal region of the country.
Here is located a volcano of the same name, which is intended to feed its energy to the Bitcoin city (Bitcoin City), whose construction was announced by President Nayib Bukele on November 20.
However, CriptoNoticias found that in this volcano a geothermal plant has not been built yet, and it is unknown when the first stone will be laid to raise the Bitcoin City.
With more enthusiasm regarding mining issues, CriptoNoticias visited days later the Berlin geothermal power plant, which has been fully functional for years and provides energy to a container of Bitcoin miners within its facilities.
In the town of Berlin, in the department of Usulután, 120 km from San Salvador, this geothermal power plant is responsible for extracting water vapor and sending it to the electricity generation turbines.
This steam is generated naturally due to volcanic activity that heats a reservoir of water at the bottom of the earth. Once electricity is generated through the turbines, this steam is allowed to cool until it condenses again in a liquid state, where it is injected back into the bottom of the earth to repeat the process.
During our tour we were able to know in detail the operation of the plant, which contributes 22% of the electricity consumption of El Salvador; as well as see closely the only container of miners that works in these facilities.
The container has powerful hot air extractors, and a ventilation system at full throttle to balance the temperature of the Bitcoin miners that operate there.
Some of the equipment that we could see in operation were the Antminer S19 line, from Bitmain, and the MicroBT Whatsminer M30S. Total, they have 300 operational Bitcoin miners, that consume 1 MegaWatt per hour of energy.
Visiting LaGeo and seeing the miners operating was one of the most desired goals achieved of our trip; And while these miners are just the first step the country has taken, they hope to create more geothermal-powered mining farms in some of El Salvador’s 170 volcanoes.
Bitcoin mining advances between business and technological innovation
With the rise in the price of Bitcoin, the mining of this cryptocurrency has become more attractive to new investors in the last year.
For example, since we published our last Noti Hash, we reported how the Celsius Network is using Bitcoin mining to power its loan business; doubling your initial investment to $ 300,000.
In our previous editions we have already highlighted the activity of mining companies. In 2021, many managed to overcome China’s ban on Bitcoin and its mining, settling in other countries such as the US, Kazakhstan, Iran, Russia and Canada; while countries like Paraguay, Argentina, Laos and Venezuela also open their doors.
Venezuela, according to Anibal Garrido, consultant and cryptocurrency miner, is being more receptive to Bitcoin miners given the progressive overcoming of the national electricity emergency, as well as due to the legal speed with which this activity is being regulated after years of irregularities.
Being a thriving industry, it has been wanted to accuse Bitcoin mining of the shortage of microprocessors in the world, but a report by CriptoNoticias reveals that it is actually the low supply that manufacturers can provide at this time in a market high demand.
Underwater miners: cooling technique regains popularity
When criticism has arisen about energy aspects against Bitcoin mining, it has been able to respond with concrete solutions, such as using residual natural gas, or using surplus production in the local electricity grid.
Thus, Bitcoin mining could be a catalyst for technological advances or the emergence of novel solutions. Such is the case of cooling tanks of mining equipment, where this hardware can be submerged to drown out the sound or noise they make, or the heat expelled.
Specialists believe that more and more miners will make use of this cooling technique, allowing Bitcoin mining to reach hot or poorly ventilated places over time.
Shares on the stock market retreat for mining companies
Compared to the previous issue of this newsletter, the major publicly traded Bitcoin mining companies saw their share price decline on the stock market, according to Nasdaq and Bloomberg.
Marathon fell from $ 54 to $ 48; Hut 8 from USD 15 to USD 10; Canaan from USD 9.7 to USD 8.44; Riot Blockchain from $ 36 to $ 32, and so on with everyone on our list.
Bitcoin difficulty hits the brakes after months of growth
The months between May and July were a serious setback both for the difficulty and for the mining power or hash rate of Bitcoin, due to China’s bans on this activity.
However, since July, when the miners managed to establish themselves in other countries after leaving China, the difficulty increased substantially in the following 9 consecutive adjustments.
Now, that good streak was narrowly broken, since last November 28 the difficulty fell by 1.49%, according to BTC.com, preventing Bitcoin from reaching the 10 positive difficulty settings during this season.
This last adjustment left the mining difficulty at 22.34 T.
For its part, the hash rate, the mining power of the network’s miners, did not have a substantial increase during the month of November either.
On the contrary, it remains stable with respect to the levels of October. This happens at the same time that during the last weeks the price of Bitcoin fell and kept oscillating between USD 54,000 and USD 65,000.
The fact that the difficulty was reduced, and that the hash rate did not increase either, may be directly related to the increase in transaction fees of the Bitcoin network.
In recent days we have observed the increase in the volume of transactions waiting on the Bitcoin mempool, and therefore the increase in average commissions, according to Mempool.Space.
At the time of writing this note the average price of Bitcoin commissions is at 6 satoshis per virtual Byte (sat / vB) for low priority transactions; 9 sat / vB for medium priority, and 14 sat / vB for high priority, as you can see in our Bitcoin price and commissions calculator from CriptoNoticias.
Distribution of mining pools leans towards the United States
Another milestone in the recovery of miners, both at the level of companies and farms and pools, is the positioning of Foundry USA as the most powerful pool among all those in the world. It is the first time in history that an American pool has become the most dominant among all existing Bitcoin mining pools.
Another factor that draws our attention is the positioning of the unknown pools in the third place of the most dominant. This could mean that a large number of unidentified miners are working on the network, possibly clandestinely. Could the miners be left behind in China? It is probable.
Picture of the week:
This is what the interior and exterior of the container located in the geothermal plant in Berlin, Usulután, El Salvador looks like, where more than 300 specific application units (ASICs) are operated for Bitcoin mining.