Key Takeaways
- The upcoming Bitcoin halving will reduce mining rewards from 6.25 to 3.125 BTC.
- Miner hashprice has dropped 30% since the last halving, impacting profitability.
- Bitcoin network hashrate has surged to 600 EH/s, increasing competition among miners.
In about 10 days, the Bitcoin halving will slash mining rewards from 6.25 to 3.125 BTC.
This event puts pressure on miners, who now need higher Bitcoin prices to maintain earnings.
Miner profitability concerns
CryptoQuant reports a 30% decrease in miner hashprice since the last halving in May 2020.
Hash Price is the revenue generated by miners on a per hash basis. The higher the hash price, the more profitable mining is for miners.
The hashprice is set to nearly halve again after the halving, impacting miners’ revenue significantly.
Additionally, Bitcoin transaction fees have plummeted by 90%, further reducing miners’ income.
Rising competition and costs
The Bitcoin network hashrate has skyrocketed to 600 EH/s, increasing competition among miners.
This surge means higher costs for mining the same amount of Bitcoin, with some miners increasing their selling of Bitcoin in response in order to cover costs.
Diverse miner performance
While some major mining companies report declines in Bitcoin production, others like CleanSpark have seen increases.
Sheraz Ahmed, Managing Partner at Storm Partners, believes market forces such as an increasing Bitcoin price, will eventually stabilize the situation, similar to past halving events.
