Bitcoin Mining Unprofitability Makes Miners Move Towards Alternatives Including ZCash

Bitcoin Mining Unprofitability Makes Miners Move Towards Alternatives Including ZCash

During 2018, Bitcoin (BTC) and other digital currencies have been in a bear market that affected their price in a very negative way. Some cryptocurrencies lost more than 90% of their value, while Bitcoin dropped around 80%. Due to this situation and the fact that the number of miners grew during the year, the mining difficulty rate made it impossible for all the miners to keep being profitable.

Back in November 2018, when the crypto market fell before the Bitcoin Cash (BCH) hard fork, miners started to shut down their operations and leave the market. After a difficult adjustment, some of these miners came back to the market, but others preferred to move to other networks such as ZCash (ZEC).

It is important to mention that Bitcoin moved from $20,000 back in December 2017 down to $3,200 a few weeks ago in December 2018. Now, Bitcoin is being traded around $3,450 according to CoinMarketCap. This clearly affected the profitability of miners in the space.

Other coins such as ZCash have been welcoming new miners during the last few weeks. This coin, for example, is offering better returns for individuals and companies that start mining it and protecting the network. ZCash offers a greater reward for each of the blocks that were mined.

ZCash is a digital asset that focuses on privacy allowing users to have their data protected when they process transactions. At the same time, the ZCash network experienced an exponential increase in its hash rate since the beginning of 2018.

Privacy coins are becoming much more important year after year. With increased surveillance from governments and other regulatory agencies around the world, users are searching for new options to protect their information and privacy when they use cryptocurrencies.

Bitcoin uses a system that works with pseudonyms rather than anonymously. This is something that blockchain analysts are using to link specific accounts to individuals trading digital assets.

Other coins that have never focused on privacy, such as Tron (TRX) or Litecoin (LTC) are going to implement different privacy-focused features. Charlie Lee announced that they are working on Confidential Transactions to add fungibility to the cryptocurrency space.

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