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Bitcoin Mining Margin Squeeze Sees Revenues Evaporate

Bitcoin mining operators are having a tough time during the bear market as reduced margins have resulted in much lower revenues.

BTC prices may have rallied back over $20K this week, but Bitcoin mining operations are still in the doldrums.

On Oct. 26, Jaran Mellerud from Hashrate Index reported that mining margins have evaporated over the past year. As an example, he used the gross margin of a Bitmain Antminer S19j Pro which was 88% in October 2021. Today, that gross margin has fallen to 38%.

However, this does mean that Bitcoin mining remains profitable … for now.

Bitcoin mining woes  

According to the report, this time last year, Bitcoin miners could produce 50% more BTC per terahash per second than they can today.

This is largely due to the increase in difficulty, a measure of competition among miners seeking to solve the network’s next block, and a decrease in hashprice.

Hashprice is a measure of market value assigned per unit of hashing power in dollars per terahash per second per day ($/TH/s/d).

bitcoin mining BTC
Source: hashrateindex.com

The large Bitcoin mining companies and pools have greater capacity in exahashes per second. One EH/s now produces 3.5 Bitcoin per day, compared to 6.7 BTC per day this time last year, the report noted.

This means that only the miners who have doubled their hash power over the past year can earn the same amount
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