Finance will work with BitRiver to attract miners to its pool

Binance wants to consolidate in its pool more hashrate of the Bitcoin network from Russia and Central Asia, by deploying a physical server node on the BitRiver mining site in Bratsk.

According to Binance and BitRiver, the initiative will allow owners of ASIC miners in BitRiver who decide to switch to Binance to get a better connection and direct routing to the mining pool.

In turn, Binance will get access to clients who manage devices hosted in BitRiver. At the moment, the total capacity of the enterprise for BTC mining is 70 mW/h out of the total capacity of 100 mW/h.

According to the Cambridge Bitcoin electricity consumption index (CBECI), the current average monthly hashrate from miners in Russia is 6.08% of global BTC production, and from miners in Kazakhstan – 3.14%. At the same time, the hashrate from Chinese miners decreased from 75% recorded in the third quarter of 2019 to 71%.

Currently, nine of the ten largest pools of BTC mining by hashrate are either Chinese companies, or they are owned by cryptocurrency exchanges whose owners are associated with China.

If we assume that on average BitRiver clients use modern ASIC miners, such as Bitmain’s AntMiner S17 or equivalent models, the total hashrate of BitRiver farms can exceed 1,000 Px/s. Although this hashrate may only account for about 1% of the total computing power of BTC, the deal highlights Binance’s strategy of absorbing miners in different regions.

“Binance Pool offers a very competitive Commission structure for institutional-scale miners-clients of our data center,” said BitRiver CEO Igor Runets.

According to his estimates, up to 50% of the hashrate of BitRiver customer farms can be moved to the Binance Pool after the transaction. Runets added that these clients will mostly leave the pool managed by Bitmain.

Both sides did not disclose whether Binance will offer special Commission terms to attract BitRiver customers. However, the below-market rate is one of the key measures that Binance is taking to attract new miners to the pool. According to available information, Binance wants to establish a similar cooperation with miners in Kazakhstan.

Recall that the Binance cryptocurrency exchange deployed a mining pool at the end of April and gradually accumulated 7,000 Px/s of the total hashrate of the Bitcoin network. Currently, Binance Pool is the eighth largest BTC mining pool.

Binance pool implemented the full-Pay-Per-Share (FPPS) model and initially offered zero commissions, but now charges less than 2.5% Commission. But in some cases, the fee offered to major mining operators may be lower than 1%.

Meanwhile, other large BTC mining pools, such as F2Pool and Poolin, have also previously reduced their commissions from 4% to 2.5%, although more favorable terms are provided for large clients.

The FPPS model means that the pool only charges an agreed subsidy fee for each block mined, and then distributes the subsidies as well as transaction fees to the miners in proportion to their contribution. According to current data, since the launch, Binance Pool has produced 488 blocks with a total subsidy of more than 3,000 BTC.