According to data from Fork.lol (based on the current relative difficulty retarget and exchange prices), Bitcoin Cash miners could have made 1.4x more USD profits if they were pointing their hash rate towards the BTC chain yesterday.
By way of example, if you were running a sha-256 mining operation on Bitcoin Cash and were making $10,000 USD in profits per hour, you could have been making $14,000 instead, just by deciding to mine for BTC blocks (assuming they are sold off immediately back to USD).
We currently see around 4.4 exahashes per second of hashrate on the Bitcoin Cash network, this compares to more than 50 exahashes per second of hashrate on the BTC chain.
A few days ago, Bitmain CEO Jihan Wu was reported to have been mobilising 90,000 mining machines to gain an upper hand in the hard-fork that is scheduled for today. That amount of S9 miners could equate to 1.2 exahashes of mining power (or around 25% of the current hash power on the BCH chain today)
Jihan:
I have no intention to start a hash war with CSW, because if I do (by relocating hash power from btc mining to bch mining), btc price will dump below yearly support; it may even breach $5000. But since CSW is relentless, I am all in to fight till death! pic.twitter.com/d95axXEwFS
— RamenPanda (@IamRamenPanda) November 14, 2018
Regardless of the potential ‘mountain’ of miners Jihan may have at his disposal, he seems cautious about any hash war after stating that he has “no intention to start a hash war with CSW, because if I do (by relocating hash power from BTC mining to BCH mining), BCH price will dump below yearly support”.
Hash wars on the horizon
Jihan may not be the only one as Roger Ver’s mining pool at Bitcoin.com has also suggested that it will be prepared to redirect hash power from Bitcoin to Bitcoin Cash ABC. Bitcoin.com currently has around 0.75 exahashes of hashing power pointed towards the BTC chain.
As we go into the fork it will be interesting to see what incentives may appear for mining pools who strictly focus on USD profitability and not worry about the politics that may come into play. During the launch of Bitcoin Cash chain last year, at one stage we witnessed almost 50% of BTC miners direct hash power toward the BCH chain.
This occurrence also kept happening during the most profitable moments before the difficulty re-targeting adjustments on the BCH chain in late 2017 (prior to the EDA hard fork).
With the BCH hard-fork only moments away, we might see a hash war emerge as miners redirect mining power from BTC and towards one of the Bitcoin Cash chains. This may mean the possibility of less miners available to sustain the Bitcoin network if the hash wars continue. If this happens, be prepared to see BTC block times rise over 10 minutes and potentially even exchanges announcing extended confirmation times for deposits.
Disclaimer: The views and opinions expressed by the author should not be considered as financial advice. We do not give advice on financial products.