25 February, 2024

Bitcoin Miner’s Revenue Shrinking Causing Second Sell-Off of the Year?

1 year ago

22 Nov, 2023

The world’s largest cryptocurrency ecosystem, Bitcoin has been consistently within a tight range situated near the US $19,200 price mark. The Bitcoin hash rate has been steadily increasing over the past few months which is beneficial for investors. However, Bitcoin miners have been receiving the short end of the stick as they are now having to add more computational power into the network when adding blocks to the blockchain.

This can be extremely threatening to the Bitcoin ecosystem as the cost of energy has been increasing, and miners are having to pour more money than before while earning minimal revenue. Bitcoin miners may have another major sell-off, which occurred earlier this year, and caused Bitcoin to go into a bear.

According to reports, these BTC miners are earning their lowest relative to the power applied currently throughout history. This is causing an imbalance in the income of this industry. Another report claims that Bitcoin miners’ revenues have dropped by 81% since their peak in October 2021.

All miners have been suffering from the rising costs of harvesting power. Europe has little to no mining activity due to its energy crisis, other countries have been facing the heat too. The larger population of these Bitcoin miners is in the US where power prices have been soaring and are expected to continue to soar during this geopolitical tension.

While bitcoin miners have been facing new lows each day, long-term bitcoin holders are staying positive. The supply for Bitcoin has consistently been at an all-time high of 78% despite the ongoing macroeconomic crisis, geopolitical tension, and WW3 fears. 

An expert analyst claims that Bitcoin is entering an “unstoppable maturation stage”. Meaning, Bitcoin prices will continue to rise despite all the odds going against it. Currently, Bitcoin is trading at $19,340 with market cap of $372 billion.