Opinion: Big oil and gas majors embrace mining

Bitcoin hash rate hit a new high, drawing the attention of Capriole Investments founder Charles Edwards. The expert suggested that this is linked to the entry of large players from the energy sector into the industry.

New Bitcoin hash rate world record! 9% higher than the prior all time high set just a few days ago.

I have no doubt that we have serious, highly efficient government & oil company enterprises entering the mining game at scale as we speak. pic.twitter.com/YBSswwvK59

— Charles Edwards (@caprioleio) November 1, 2022

According to Glassnode data, as of November 1 the Bitcoin network’s hash rate stood at 272.4 EH/s (7-day smoothed moving average).

“I have no doubt that we have highly efficient government and oil companies actively participating in mining,” Edwards said.

According to him, the hash rate growth amid Bitcoin price stagnation does not resemble miner capitulation. “It’s the opposite,” he said, adding that equipment is now being deployed “at scale”.

In the short term, miners are forced to sell mined coins to cover costs, the expert says. Such a scenario would lead to stagnation or a decline in hash rate, which is not observed. He believes this confirms the thesis that other participants are expanding their equipment.

“Big oil companies will undoubtedly become major players,” Edwards believes.

In the discussion, many users agreed with his assumption. In their view, only miners linked to energy giants will survive, and even they will be forced to share profits.

This is the future of Bitcoin mining.

— Charles Edwards (@caprioleio) November 1, 2022

“This is the future of Bitcoin mining,” Edwards said.

The author of the popular Twitter account Bitcoin Archive acknowledged the persuasiveness of his arguments in a comment:

“The increase in hash rate while the largest miner goes bankrupt leads me to 100% agreement. I simply do not see any other plausible explanation.”

the magnitude of hash rate increase while the BIGGEST miner is going broke leads to me agree 💯

I just cant see any other plausible explanation to account for it.

— Bitcoin Archive 🗄🚀🌔 (@BTC_Archive) November 1, 2022

In late October Core Scientific, which has the largest Bitcoin hash rate among public companies, warned of liquidity risk and possible bankruptcy. Following that, Argo Blockchain issued a statement about financing difficulties.

In 2020, it emerged that the Norwegian energy company Equinor Energy began mining on flare gas in partnership with the American firm Crusoe.

In 2022, similar pilot projects in the United States were launched by ExxonMobil and ConocoPhillips.

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