Since the April 2024 halving, the Bitcoin mining sector has been under increasing pressure. Revenues have reached an all-time low, forcing miners to review their strategies and unplug some of their machines.
How did the halving impact the Bitcoin mining industry?
Historically, Bitcoin halvings have triggered significant bullish movements in the cryptocurrency market. However, since the 4th Bitcoin halving in April 2024, the Bitcoin price has been correcting, falling from $73,750, its last all-time high, to $49,500 a few days ago, a total decline of 33%.
The halving, which halved block rewards, also sharply reduced miners' revenues.
🔋For further information – Discover how Bitcoin mining is influencing the energy sector
Additionally, this Monday recorded the lowest day in transaction fees since the beginning of the year, synonymous with very low profitability for miners.
The combination of halving, falling prices and low transaction fees is causing many miners to disconnect some or all of their machines.Since the halving, the hashrate has dropped by 10%, recovered for a few days, and finally dropped again by 4% after the crash on Monday, August 5.
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How are Bitcoin mining companies doing?
Core Scientific, a 26.1 EH/s miner, emerged from bankruptcy a few months ago and recently placed an order for 15 EH/s chips from Jack Dorsey's company Block, despite a net loss of 800 million dollars in the 2nd quarter of 2024.
Cipher Mining reported a loss of $15 million in Q2 2024, up $1.8 million from the previous quarterDespite these losses, this miner, which has 8.7 EH/s, aims to reach 13.5 EH/s by the end of 2024 and 35.0 EH/s by 2025, an increase of 300% in its computing capacity.
Hut 8 grew revenue 72% year-on-year, but still records a net loss of 71.9 million dollars in the 2nd quarter.
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Marathon Digital, the largest mining company in the United States, posted nearly $200 million in losses in the second quarterup from just 9 million a year earlier. Despite this, Marathon Digital recently announced the purchase of $100 million in Bitcoin, bringing its holdings to 20,000 BTC, worth $1.2 billion.
Although revenues are down, mining companies remain optimistic about their long-term earnings.
Finally, a battle seems to be brewing in the mining race. On one side, Marathon Digital recently started writing “Made in USA” on the blocks mined by Mara Pool.
On the other hand, Russia recently adopted legislation clearly regulating Bitcoin mining, opening the door to the development of the activity in the country, thus announcing a possible war of computing power.
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Sources: Marathon Digitals, mempool.space
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First attracted by the lure of gain, I am now trapped deep into the rabbit hole. With no way out, I have no choice but to share my knowledge and transmit the passion I have for the blockchain universe. I am also the creator of Adopt a Block, an educational site dedicated to Bitcoin.
Marius Farashi Tasooji
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