New CoinMetrics Study Indicates Big Crypto Miner Pools Have a Higher Chance of Going Under
Coinmetrics.io recently published a new study. The study had been commissioned with the sole purpose of investigating the hashrate history of some of the more widely known BTC mining pools. The research that was conducted by the open source website led to the discovery of some very interesting information.
This is information seeks to provide valuable insight into how mining pools operate. It also provides some important information on the evolution of the mining environment since cryptocurrencies came to be.
Big Mining Pools Tend To Be Fallible
The crypto mining ecosystem is currently rated as one of the most competitive activities across the globe. Its competitiveness has continued to pass with each passing year. In addition to increased competition, the study revealed that the current processing power of the major algorithm-based tokens is higher than that of the global supercomputers combined.
The reason for this being that there are businesses and individuals spread out across the globe who have sunk personal fortunes into mining rigs. Some of the data that was released by Coinmetrics on their latest survey was nothing short of interesting. The information in its report touches on some of the rigs that have been processing bitcoin blocks since inception.
According to the company spokesperson, Coinmetrics commissioned the study in order to respond to some of the issues that had been raised by a news piece published by Ark Invest. The news piece published last year touched on the hashrate distribution as well as some of the issues that have been plaguing the mining industry for years.
The team behind this news piece claimed that they obtained their data from some of the reports published on Coinmetrics. This is data that is traditionally obtained from popular sources such as Bitcoinity and BTC.com. The authors did, however, point out that it also took its time to parse the outputs emanating from the more than 450,000 blocks being parsed by coinbase.
Unlike in past years, many of the mining pools in operation today rely on coinbase parameters so as to identify themselves each time a new block gets mined. According to Coinmetrics, this takes place voluntarily. It is also worth mentioning that this is not something that used to take place in past days.
Taking this into consideration, Coinmterics overlooked the very first 100,000 blocks to be mined. When the research team was parsing the mining chains, they came to the realization that there existed close to thirty-seven large solo miners in different parts of the world. According to statistical reports, this would indicate that these individual miners were able to mine a total of 0.1 percent of the total blocks in existence at the time.
The report goes on to emphasize that the one standout point from this research is that major mining pools are very fallible. This is because some of the largest single miners in existence at the time have today gone out of business. These are the same miners, who while at their peak held total control over the BTC hashrate.