While everyone is prepping for bitcoin halving, a recent report by market research firm Researchnester.com has revealed that the global cryptocurrency mining equipment market is expected to expand at a significant CAGR of 17.5% over the forecast period i.e., 2018-2027.

Rising investment by large semiconductor companies such as NVIDIA Graphics and Samsung Electronics in mining-specific equipment is expected to drive the growth of the global cryptocurrency mining equipment market over the forecast period.

According to the report, the increase of crypto adoption in developed regions such as the U.S. and Canada is also expected to positively impact the growth of the cryptocurrency mining equipment market over the forecast period.

Additionally, the growing prominence of cryptocurrency for daily transactions is positively impacting the customer perception of crypto. This factor is projected to significantly impact the growth of the cryptocurrency mining equipment market, particularly in North America.

This report comes at a time when the crypto sphere has been directing some of its attention toward Bitcoin’s reward halving and how it will affect miners and their hardware.

How Will the May Bitcoin Halving Affect Miners?

The May Bitcoin (BTC) halving will give the coin one of its most important features — its deflationary status. The upcoming halving will be the 3rd of its kind and will reduce the Bitcoin issuance rate to 6.5 BTC for every 10 minutes of mining.

The halving is a highly anticipated event for industry insiders, with many having a bullish outlook for the price after the issuance is reduced.

Production is cut in half, and many expect the demand to stay the same or to increase, which means the price would be bound to increase according to the laws of supply and demand.

Given that miners are a big piece of the Bitcoin puzzle, it’s important to understand how they have been preparing for the upcoming halving and the unknown price action that will ensue.

The recent Black Thursday crash led to the biggest mining difficulty drop since 2011 and further highlighted the selling pressure from miners, many of whom were forced to shut down their operations as profitability dropped.

This process, described in a report by Blockware Solutions as “miner capitulation,” leads to a change in the mining ecosystem that rewards more advanced operations — which have the possibility to hold Bitcoin for a longer period and to change the dynamic of when and for how much newly minted BTCs will be sold.

If prices increase substantially, there won’t be much to worry about after the halving, as miners will receive fewer rewards but will be able to sell each one for a higher value.

Many Bitcoin Mining Machines Could Go Offline

Even as Researchnester projects a growth in the crypto mining equipment market, there are worries that miners could be forced to switch off mining units to decrease Bitcoin’s hash rate and, by extension, their costs.

If hashrate and mining problems keep surging and miners are forced to swop their old rigs with newer models, this could exacerbate mining costs after the halving. In fact, TradeBlock recently estimated that the gross cost of mining a single BTC might even reach $12,000 – $15,100.

As for how many mining machines will likely go offline after the halving, Qingfei Li, F2Pool’s Chief Marketing Officer, forecasts 40% or even more mining machines switching off in the first two weeks after the halving, especially old generation units like the Antminer S9.

But after these two initial weeks, Li suggests we will witness a gradual re-equilibration with the BTC hashrate stabilizing between 65% -75%.