Reasons Why Miners Are Leaving Money On The Table To Mine Bitcoin Cash

It was reported in the Bitcoin Magazine that Bitcoin Cash could be encountering a freeze in their blockchain over a short period of time in the coming future. The report was the outcome of an assumption where they considered miners to act according to their self-interest while having a vision only for the short run. In the following weekend of the report, the Bitcoin Cash situation intensified to another level when miners called for a partial emergency difficulty adjustment which led to few significant shift in hash power,  block time periods which were not reliable and also caused inflation to rise.

The story unfolds with another twist in the tale. In present times, Bitcoin Cash is reported to be making less profit than BItcoin in order to undertake to mine. Based on the statement of one of the operators of a mining pool, this situation was created intentionally. Some miners are reportedly working in order to maintain the Bitcoin Cash difficulty as it is now, which is relative to Bitcoins itself. This was done in order to keep the prices of the two coins relatively similar to each other. We can conclude that Bitcoin Cash is being kept less profitable to mine than Bitcoin intentionally.

As explained in the article before, miners are likely to shift to the chain that is most profitable to be mine if they are driven by their short-term incentives to achieve higher finance but they are not influenced by the activities of other miners. Irrespective of the fact that Bitcoin Cash is experiencing lower profits, miners are still continuing to mine and that is taking place at a constant rate as before. Blocks are found to be in the state that it was operating at, the rate of inflation seems to be within the expected range. These facts help to support the fact that the situation Bitcoin Cash is experiencing is a stable situation.

This means miners are leaving money for the sake of Bitcoin Cash to keep it usable but the main question is why is it happening.

A simplified reasoning for the particular situation is mainly due to the fact that miners believe and has claimed that they are likely to see a massive increase in the exchange rate for BCH. On the basis of their predictions, we can figure out that the present miners are willingly taking the risk and are continuing to mine just so that they are able to enjoy the fruits of their labor which they had put in despite knowing the fact that the gamble was too risky for them. Moreover, more miners could be employed for Bash’s sake in order to keep their investment and Bitcoin Cash itself running smoothly.

Back to Top