Bitcoin mining companies are vying to mine the first block post-halving to obtain an ‘epic’ satoshi, potentially valued at several million dollars, according to CoinDesk.
What is the value?
Approximately two years ago, Casey Rodarmor, creator of the Ordinals protocol on the blockchain of the first cryptocurrency, developed a system for classifying the rarity of individual sats.
With the introduction of ‘inscriptions’, it became possible to number and sell fractions of bitcoin akin to non-fungible tokens. Rodarmor’s scale ranged from the first ‘uncommon’ satoshi in each block to the ‘mythical’ — the very first in blockchain history.
One of the highest rarity levels is the ‘epic’ sat, mined in the first bitcoin block after each halving.
The founder of Ordiscan, known as Tristan, suggested that Ordinals collectors might ‘conservatively’ value this asset at $50 million.
“If we compare the number of satoshis obtained during an event that occurs every two weeks [difficulty adjustment] with the number obtained every four years, I don’t know how much they will be worth, but this value could reach millions of dollars,” stated Adam Swick, Director of Development at mining company Marathon Digital.
The Hashrate Race
CoinDesk speculated that mining companies might coordinate their efforts to mine the rare sat just before the halving, which is expected to occur on April 20 at block height #840,000.
The network participant who mines the coveted block must send 546 satoshis — the minimum transaction amount known as the ‘dust limit’ — from part of the 3.125 BTC reward to a cold wallet. Subsequently, the sat entering the mempool will be retroactively marked as the first of the era.
“Essentially, they split 3.125 BTC into two parts: one is incredibly small, containing the first satoshi, while the rest is just bitcoin, with nothing special about it,” explained Tyler Whittle, a representative of Ordinals Taproot Wizards.
According to Swick from Marathon, the company possesses ‘thousands of such uncommon satoshis’, including the first in a block. The firm has frequently studied the market to understand the value of such assets.
Marathon also mined the first sat after a difficulty adjustment, which at one point was ‘worth hundreds of thousands of dollars’.
Miner Hut 8 is examining its balance for rare resources it may already own.
“When we first started mining, people said they would pay a premium for primary bitcoins, but it’s not a very liquid market, so the price isn’t very clear,” noted the company’s CEO, Asher Genut.
Major miners with high hashrates are well-positioned to claim the ‘epic’ satoshi. For instance, Marathon’s share is about 5%, giving the firm a corresponding chance to obtain the first post-halving sat.
“We understand it’s a kind of lottery ticket. But we strive to ensure all our devices are connected to the network. This is our goal anyway, and we are acutely aware of the approach of the halving,” added Swick.
Thomas Chiappas, CEO of Argo Blockchain, noted that miners can only claim the desired satoshi if they have capacities comparable to Marathon’s.
10x Research warned of a potential $5 billion bitcoin sell-off by miners post-halving.
In April, Marathon CEO Fred Thiel stated that the upcoming block reward reduction is already factored into bitcoin’s price.