The rise of major Bitcoin mining institutions is inevitable

That is why we are seeing a rush of institutions pouring into the Bitcoin mining space and starting to build out megafacilities.

The West only receives a finite allocation of these new machines, and with 17 publicly listed mining companies and ASIC financiers and large co-locations announcing purchases weekly, you can see how that fresh supply of equipment quickly dries up.

Large mining companies receive discounts on ASIC retail prices.

Access to various forms of funding such as debt, equity, equipment financing and ASIC financing is crucial for mining farms to stay large and enjoy the benefits discussed above.

Institutions have helped bring more transparency to mining pool pricing, reduced the number of pools that steal from the miners, and incentivized pools to build out new feature sets.

The mining pool industry is evolving rapidly, and if companies don't keep up, they will get left behind.

Other verticals such as mining pools, container manufacturers, ASIC management software, mining media, firmware developers and ASIC resellers may also be consolidated into broader offerings.

In 2015, if you had told the miners where we would be today, they wouldn't have believed you: millions of ASICs securing the network, gigawatts of power being used and institutions such as Fidelity with their own mining operations.

Legacy Bitcoin-native mining companies must work hand-in-hand with these new entrants to shape a good future for Bitcoin.

Ethan Vera is the co-founder of Luxor Mining, a North American-based hash rate liquidation platform serving the Bitcoin and altcoin mining communities.