- The research report stated that BSV miners incurred significant losses and stated that miners not driven by profit.
- From Nov 2018 to Dec 2019, BSV miners have collectively incurred a loss of around $12 million to $13 million.
According to a report by Binance, the motivation driving Bitcoin SV (BSV) miners is non-economic in nature. Binance’s research arm, Binance Research, has attempted to estimate the mining profitability for Bitcoin (BTC), Bitcoin Cash (BCH) and Bitcoin SV. The data in the report concluded that BSV miners incurred prominent losses and consequently stated that the miners are not driven by the profit.
From November 2018 to August 2019, BSV mining profitability has been lower than BTC and BCH mining profitability, according to the report. Researchers believe that this has clear implications.
In summary, the Bitcoin SV reward-to-difficulty pattern implies that a significant portion of its hashpower might not have emanated from economically-driven actors until August 2019.
Additionally, Binance Research calculated the loss sustained by the miners because of mining Bitcoin SV instead of Bitcoin. The report stated that between the November 2018 – December 2019 period, BSV miners have collectively incurred a loss of around $12 million to $13 million. The researchers came up with a possible explanation for this seemingly irrational behavior of the miners.
BSV miners were presumably not mining at a loss over the first six months of 2019, and their respective vested interests (i.e., owning a lot of BSV coins) probably outbalanced opportunity costs. These vested interests would incentivize them to secure the BSV network to preserve a significant portion of their capital.
Bitcoin Cash mining profitability was also lower than that of Bitcoin between June and August, as per the report. Binance Research estimates that BCH miners have sustained an opportunity cost of about $7.7 million.
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