Since the highs of last year, the cryptocurrency market, in general, has bled out and is now struggling to reverse the significant downtrend. Bitcoin, the world’s largest cryptocurrency isn’t immune to it either and its losses have forced miners to quit Bitcoin mining activity. However, Zcash [ZEC] could emerge as a worthy mining alternative for many.
Since Bitcoin hit an all-time high of $19,783 in December, the cryptocurrency has seen a genuine tumble, especially after mid-2018. Presently, Bitcoin is down by over 80%, when compared to its all-time high price. This suggests that profit margins have also fallen for many miners and mining pools who count on high BTC prices to keep their business running.
Furthermore, high electricity and equipment costs associated with keeping the mine in business are cutting into these profits too, forcing many to quit mining Bitcoin. In fact, mining is such an expensive process that it currently surpasses the value of 1 BTC which is around $3,600. Each of these factors has forced over 100,000 miners to shut down shop because of unprofitability, according to a report last month.
In such an environment, alternatives such as Zcash have been welcomed. Miners have been reportedly fleeing to the Zcash scene because it offers a greater reward for each block mined, guaranteeing a greater profit margin. Zcash, a cryptocurrency that ensures a fixed supply of coins over time and launched in 2016, is presently two halving periods behind Bitcoin. Furthermore, what has attracted miners to Zcash is the exponential growth in hash rate the cryptocurrency has witnessed since the beginning of last year. According to some estimates, it is as high as 400% over the past year, contributing to its larger pay-offs and profitability for miners.
Another asset factors into the advantage Zcash may hold in 2019. Hit by several hacks and thefts, the cryptocurrency industry is on the lookout for a coin with very strict privacy options. Zcash could be one of them as it has features protecting confidentiality and privacy. This would be especially convenient for the rich, who would like to hold their assets in completely anonymous wallets with the utmost privacy. In a world of growing income disparity, it is more likely that the rich hold their riches in the form of coins such as Zcash which are privacy-enabled.
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