Cryptographic miners' "thriller" August

Author: 0x66, rhythmical BlockBeats

For cryptographic miners, 2020 has been both a year of innovation and a year of magic.

Although the same status as miners, but different miners of the situation gap between a little. While ethereum miners basked in the recent surge in mining profits, bitcoin miners in the mountains of Sichuan were fretting.

In August, sichuan was hit by its worst flood in a century, flooding streets quickly, followed by mudslides and landslides that quickly covered roads and homes. Bitcoin mines, hidden in the mountains, were not spared.

The sudden flood has also let the owners of mines in the upper and lower reaches of the Qingyi River in Sichuan province experience the most difficult little half month: the network is blocked, operation and maintenance trapped, plant destroyed. The Ethereum miners, by contrast, have made good money recently.

"There have been four mudslides this year."

"People are fine, just good." Over the past few days, Mr. Lu, a miner, has seen similar messages below as he has posted on wechat moments about the damage to his mine caused by a mudslide, often encouraging each other and huddling for warmth.

Since August 10 this year, sichuan began to see heavy rainstorms, and many counties were affected to varying degrees. In particular, in the early morning of August 18, the Qingyi River was flooded once in a hundred years. Since the mine is located in Leshan, where three rivers flow, bitcoin miners have been on the edge of their feet for as long as the storm has rained.

When he saw a video on social media showing the giant Buddha in Leshan up to his toes, Mr. Lu was horrified. The day before, he had received word from local workers that a mudslide had occurred in front of the plant, narrowly threatening the plant. A video from the other side shows the sudden mudslide, which took just five seconds to reach the pickup truck on the road, saying, "Luckily the power plant is ok."

Miners say there have been several mudslides this year

Since this year, some mine owners have suffered several landslides, but for such a natural disaster, he also helpless, only in the circle of friends exclaim "a year four or five landslides, almost got!" Compared with previous years, there have been more mudslides in Ya 'an, Sichuan this year. "On the whole, it is a lot more, but there are also different areas, such as Aba and other places, which are still less than last year," he said.

"I am very worried about the machine," he said. "The road to the Changheba section will soon be open, but other small mines have no access until now. People in them have no net or water, but fortunately they are safe."

According to the data, this natural disaster has seriously affected the computing power of the whole bitcoin network. On August 18, the whole network calculation force appeared abnormal decline, including coin printing, fish pond, ant pond and fire coin mine pool all appeared nearly 15% decline, now, the data has returned to normal.

On August 18, bitcoin mining pool computing power ranking information, multi-mining pool computing power dropped by more than 15%

Miners say some mines have ordered local workers to evacuate because of the flooding. But when prices are high, most miners hedge by selling the next one to six months 'worth of production in advance, to ensure a steady income even as the currency plunges.

While bitcoin miners are suffering, ethereum miners, who are getting less attention because they have fewer graphics CARDS, have recently been the envy of everyone because of the huge profits from the DeFi boom.

"Last time it was IC0 2017."

In the past few months, many crypto players have morphed into DeFi trendfarmers, from sweet potatoes to fruits and vegetables. Some players have made a lot of money, while others have lost money because the transfer fees along the chain are higher than the mining profits.

The Ethereum miners have certainly benefited from the frenzy.

Screenshot source: Weibo

Since May this year, ethereum's daily Gas fees have continued to rise, a change that was clearly felt by miners in July, when fee income briefly surpassed the system block reward. On 13 August, due to the wealth effect of DeFi Mobile Mining and Uniswap, the user's single transfer fee exceeded $20 at one point. In this context, the miner's mining income after electricity charges was as high as 92%.

One day in July this year, Lao Wei suddenly found that the unit income of the data background had changed significantly, rising slowly from 0.085ETH at the beginning to 0.1ETH and then breaking the high point of 0.131ETH. "Everyone is very happy, the last time this happened was the craziest time of IC0 in 2017." The chart below shows the daily transfer fees for Ethereum, which are apparently distributed among the Ethereum miners and pools.

Photo credit: The Block

In addition to mining, Mr. T, a miner who also worked in the mobile mine, can see the changes during this period. "In fact, earnings have improved since '312, but the changes may not be as significant." When products such as YFI and Uniswap emerged, Gas began to take off quickly, he says. "The peak was YAM."

DeFi is indeed the driving force behind all this. On August 23, the percentage of fee payments displayed on the Ethereum browser showed that Uniswap produced more than 16% of Ethereum Gas within 24 hours, and nearly 11% of USDT's Gas.

Screenshot source: Ethereum Browser

The exorbitant Gas charges have already caught Vitalik's attention, with a tweet calling for an end to them and a post denting Forsage, a Ponzi scheme, for pushing them up. But until now, there has been no good solution to the ethereum congestion problem, and some community members have even proposed a proposal to "reduce the block reward to 0.5ETH". But not many people agree.

The congested Ethereum network affects not only the investors who trade on the market, but also the smoothness of participating projects in the primary market. On August 18th the Dutch auction house SKALE announced that it had been postponed because, according to the authorities, too many bidders had brought the site down.

Of course, this is not the first fundraiser recently. Projects such as Avalanche, Near and Justswap have all come down and been delayed because their users are just too "passionate". The server problem may yet be solved, and the delayed SKALE whole Dutch auction process involves money transfers up the chain. It can be expected that without a good solution, besides speed and luck, participants will have to pay an expensive "ticket" for successful participation.

A similar site is Barter Trade, another Barter Trade project that opened on August 14th. According to players involved in the fundraising for the project, it was so popular that Gas offered a fee of up to 1 Ethereum, but it was "naive" and some were willing to pay 4.4 ethereum (worth more than $1,900) for it.

Source: Encrypted Community

In order to reduce the cost of Gas and improve the transaction speed, some players even came up with a similar to the 2017 Shengji Times cast "chain on generation cast" mode. The specific approach is: multiple people agree on an acceptable Gas fee, and then map ethereum to Solana through RenVM, Solana and other agreements that support cross-chain, and then transfer ethereum to the participating party (i.e., proxy party). Since Gas funded by crowdfunding is always higher than a single player, it means that the probability of successful participation is greatly increased. After the participation is successful, the token will be distributed to everyone.

Of course, there are still some problems in this way, for example, it does not solve the old problem that the donation run away. At the same time, the opening of crowdfunding means that the Gas "bid" of this small group will be known by others, and there is the possibility of being "used" by others. However, as more projects open up to liquidity mining, the high Gas problem in Ethereum will not be resolved in the short term, which will greatly limit DeFi's user penetration.

The DeFi boom has brought real benefits to miners, and one of the most obvious is that more money is in their hands. As ethereum prices have risen in tandem, COINS held by Ethereum miners "are up 60-70% from the previous two months, and the price of graphics CARDS is up 50%." "I think yields are a lot like the Fomo of June 2017," recalls Miner Brother T. "They just stopped making money after computing power went up so fast."

He said that some miners had been quietly laying out their case a few months ago, and that the overall calculation had risen by 20% in the past two months. Now the super-high yield has fallen back. For Brother T, the DeFi boom is just a phase of mania, and even if it does, "eth is outdoing BTC mining by a large margin after only the older miners are putting in more... [but overall] after halving this year."

Now, the flood waters in Sichuan are receding, busy repair work is underway, and DeFi fever brought on by Uniswap is cooling off. With the launch of similar platforms taking away some of the traffic, and the frequency of new products decreasing, Uniswap's trading volume has been falling back, and the return to normal returns is the miners' daily routine.

In the first half of the year, the start of work on epidemic prevention was delayed, and in the second half of the year, flood fighting and emergency repair machines were postponed. 2020 will not be easy for cryptographic miners. It is not just bitcoin miners on the ground. Another group of "would-be miners", who have arrived early, are not suffering from natural disasters, but are waiting for projects to go online. The long wait has exhausted many people's patience. Although Filecoin's main website is not online, some miners are already planning a hard fork. Moreover, the official team is also involved in the dispute with equity investors about the profit distribution when it comes online.

As the most advanced link in the whole chain, crypto miners enjoy higher returns but also take higher risks.

Whether it's the price of a currency going up and down, or the price of a currency going up and down, there are always unpredictable surprises, but some people are willing to take the risk. But it is their relentless pursuit of profit that has made cryptography one of the most globally influential businesses of all time.

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