Analysts: oil crisis will hit miners through bitcoin price
This is the conclusion reached by Hashrate Index, reports forklog.com.
Analysts assessed the consequences of the crisis after the U.S. and Israeli strikes on Tehran, which disrupted shipping in the Strait of Hormuz. Under normal conditions, about 20% of the world’s oil supplies pass through it.
The disruptions caused the Brent exchange rate to soar from $60 to more than $100 a barrel, later pulling back to $90. However, the direct correlation between the cost of production of digital assets and oil prices was minimal.
Who really depends on oil?
According to the Cambridge Center and the Bitcoin Mining Council, more than half of the first cryptocurrency’s network capacity is powered by alternative energy sources. The share of fuel oil and diesel in the energy balance of miners is a “statistical error,” the analysts’ experts ironized.
The US, Russia and China hold the largest shares of the global hashgate, followed by Paraguay, UAE, Oman, Canada, Ethiopia and Kazakhstan. In most of these countries, generation is tied to gas, coal or hydropower. The linkage to oil is minimal.
Only a small fraction of the grid’s computing power depends on the power grid, where electricity prices do correlate with fuel. The UAE and Oman concentrate about 6% of the world’s hashrate. If Iran, Kuwait, Qatar and Libya are added, the share of oil-sensitive regions reaches 8-10%.
Experts emphasized that even with such a correlation, the effect is delayed due to long cycles of tariff revision.
Bitcoin price is more important than light bills
According to the researchers, the main threat to miners is macroeconomic effects. Rising oil is stoking inflation expectations and affecting rate forecasts, which is pushing investors to exit risky assets, including bitcoin. This puts pressure on mining yields through hashpricing compression.
The dynamics were already evident earlier this year. In February, the figure fell to an all-time low of $27.89 per PH/s per day amid bitcoin’s 23.8% collapse (from $78,000 to $65,000).
Some miners have used forward hashrate contracts to fix the selling price of their computing power in advance. Over the past year, this strategy proved to be 8.2% more profitable compared to classic spot mining.
At the time of writing, the hash price is holding at $31.5 per PH/s. The seven-day moving average of the total computing power of the equipment is estimated at 1.02 ZH/s.
As a result of the last recalculation on March 5, the mining difficulty is almost unchanged, adding 0.45%.
