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Hashprice Falls to $40. Bitcoin Miners Enter “Survival Mode”
A key profitability metric — the hashprice — has dropped to levels where many small miners find it unprofitable to mine Bitcoin (BTC), raising questions about the sustainability of the entire industry.
The metric, which reflects the expected daily revenue per unit of computing power, currently stands at about $42 per petahash per second (PH/s). The figure has been steadily declining since July, when it was above $62.
The move toward $40 is forcing low-margin companies to consider temporarily shutting down equipment, according to TheMinerMag.
The drop in hashprice has also affected equipment manufacturers: orders have decreased, and Bitcoin-denominated deals have turned unprofitable due to the price drop following the October market crash.
Hashprice is rapidly approaching the level of September 2024. Source: TheMinerMag.
To offset the decline in mining hardware demand, some companies, including Bitdeer, are shifting toward self-mining.
Low operational profitability, high equipment upgrade costs, and rising electricity prices are pushing market participants to explore new directions. Many are pivoting to AI and high-performance computing (HPC) to maintain profitability amid intensifying competition.
Miners Shift to the AI Segment Amid Rising Hashrate
After each halving, the block reward in the Bitcoin network is cut in half, while the demand for computing power and energy continues to grow.
Bitcoin’s hashrate continues to rise, recently surpassing 1 ZH/s. Source: CryptoQuant.
In 2009, the block reward was 50 BTC, and mining was possible on regular computers using CPUs.
After the April 2024 halving, the reward dropped to 3.125 BTC. As mining difficulty has increased, it has long been viable only on specialized ASIC devices.
Due to declining profitability, mining companies are seeking new business avenues.
Data centers and AI computing services are now generating substantial revenue.
In October, Cipher Mining signed a $5.5 billion contract with Amazon to provide AWS computing power for 15 years.
In November, IREN entered into a similar $9.7 billion deal with Microsoft.
See also: "Phoenix Group Launches 30 MW Bitcoin Mining Center in Ethiopia"
