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The fall in bitcoin prices causes mass closures and mass cryptocurrency to close

Bitcoin mining operations in the United States and China are facing closures after the bitcoin downtrend means they may no longer be profitable.

The most precious cryptocurrency in the world is currently trading at around $ 4,500, having lost almost a third of its value within a week.

Bitcoin mining – the process of generating new cryptocurrency units by solving complex puzzles – requires huge amounts of electricity to power the computers that perform the calculations.

This means that the profitability of mining decreases when the price of bitcoin decreases and, if the price goes down too much, the operations may no longer be economically viable.

The biggest victim so far has been the US-based mining company Giga Watt, which was forced to apply for Chapter 11 of bankruptcy this week after it was unable to pay debts of about $ 7 million.

"The company is insolvent and is not able to pay debts when it is due," said the deposit, according to CoinDesk.

"The company and its creditors would be better served by the reorganization of the company pursuant to Chapter 11 of the Bankruptcy Code."

Bitcoin suffered two major price drops in less than a week, after months of market stability (CoinMarketCap)

Most bitcoin mining operations are based in China, where electricity costs are among the lowest in the world.

Yet, despite low-cost electricity, images and videos of mining operations that have broken down in the country have spread among social media.

Suanlitou, a mining platform based in Hong Kong, announced this week that it has not been able to cover electricity tariffs for a period of 10 days in November, according to the South China Morning Post.

Another group of Chinese miners of Chinese cryptocurrencies has also arrested 20,000 mining drilling rigs due to declining profitability.

It is not clear what the future will be for the price of bitcoin, with some analysts predicting more falls, while others expect the market to experience a reversal of trend by the end of the year.

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