The outbreak of COVID-19 might push smaller miners out of the Bitcoin mining Industry. It has been caused by both cryptocurrency price collapse and the shortage of the supply of new Bitcoin mining ASICS. There is even a theory that the pandemics could kill crypto mining completely.
The pandemic has caused a multitude of restrictive measures involving lockdowns across the world. Many people became unemployed due to the effects of the Pandemic, manufacturing enterprises were closed. Mining equipment producers were no exception. Thus, as they had to shut down production, there are no new mining rigs launched in the market.
Coinidol.com, a world blockchain news outlet, has previously reported that the shortening of mining equipment production in China due to the quarantine has caused a decrease in hashing power. As a result, the mining difficulty factor stagnated as the competition in the sector has somewhat relaxed.
As of now, miners still can perform computing tasks using the old rigs. However, depending on computing tasks difficulty, this might become hard enough, forcing farms and pools to halt their activity. Besides, due to the high price volatility of major cryptocurrencies, the economic viability of mining for some smaller pools and farms becomes questionable.
There is a shortage of human resources too
However, the actual effects of the coronavirus pandemic go beyond its influence on Bitcoin price and mining equipment. For instance, due to compulsory quarantine imposed in many countries, employees can not access their offices except for those whose work is necessary for meeting people’s basic needs.
Cryptocurrency mining companies are not considered as such in most countries, so most of them have been shut for quarantine, with their employees working from their homes. Therefore, there is no one to operate big mining farms that need human resources.
If the lockdown lasts long enough, it might become difficult to regain the capacities fast. However, it is very unlikely that the mining industry will cease to exist. It might be significantly transformed, as some tech companies are seeking innovative solutions. For instance, in the future miners might use quantum computers like Google’s Sycamore, instead of traditional mining rigs. It has much stronger computing potential to speed up mining operations. Therefore, losses caused by the COVID-19 lockdown might be regained in no time.
No one would argue that the coronavirus pandemics affect all industries without exceptions. And it will definitely change our lives. How? We will see over time when the lockdown ends and reveals the new needs and demands of our society.