With little demand in crypto mining, the industry is witnessing a hangover and discouragement in growth with a US-Chinese trade war.
Californian based chip designer Nvidia entered its third quarter with a crypto hangover. The pricing was volatile and it drew away business as people were waiting for it to stabilize to invest. In the fourth quarter, the expected $3.4 billion was missed and instead only $2.7 billion is now expected.
The company has witnessed 19% drop in its shares and $20 Billion loss in Value with the market coming down. The company suffered great loss as the expected buyers as gamers and data center entities did not materialize.
The market is uncertain as tax rates and electricity rates have not been regulated for crypto mining and other operations and also the uncertainty whether the governments’ of a specific region will be supportive in the future or not.
The US County Chean County Public Utility District has decided to raise the electricity rates for cryptocurrency mining, similar to the current structure. The miners will have to buy additional power as mining creates a fluctuating load on the supply. With the new changes, the county lost all its investor to other businesses. All the related fields as programming, finance, etc. to blockchain and cryptocurrency will witness a job loss.
To top this, crackdowns by the Chinese government who have previously done the same with Facebook and Google have banned crypto exchanges in the country. The mining companies are using subsidized electricity rates who are making a massive amount and have been enjoying the unlimited supply in the past with no government interference. Now with the Chinese government mandating the companies to register with Power Supply Bureau, the companies would have to disclose their real identities, as noted by Coinnounce. Furthermore, they will have to undergo tax inspection, disclose their income source and power supply required by them each month. Power cuts are expected where mining is currently happening.
With all these changes, it is no wonder that Bitcoin mining is becoming a monopoly market. And big entities as Antpool, mining more than 18% of bitcoin blocks, is controlling the mining operations. So we can see how companies as Nvidia, as reported by Live Bitcoin News, are getting affected and how other factors in an effort to regulate the industry are making the crypto mining sluggish.
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