Bitcoin Mining Margins Hit Historic Lows
Bitcoin mining margins are plunging as hashprice drops, pushing many miners to break-even levels.
- Bitcoin hashprice drops to $35 per PH/s
- Mining margins hit record lows for public miners
- Median mining costs now near or above profitability limits
The Bitcoin mining industry is facing one of its toughest periods in recent history. The profitability of mining operations has taken a sharp hit as the hashprice—a metric measuring mining revenue per hash rate—plummets to approximately $35 per petahash per second (PH/s).
This sharp decline means many public mining companies are now teetering on the edge of profitability. With median mining costs hovering around $44 per PH/s, several miners are operating at or near break-even. This creates a challenging environment, especially for those without energy efficiency or scale advantages.
Why the Drop in Hashprice Matters
Hashprice is a critical indicator in the mining sector. It directly reflects how much revenue a miner earns from the network in exchange for their computational power. When hashprice falls, miners earn less for the same effort and energy costs remain constant—or even increase—depending on location and power contracts.
The current slump in hashprice comes amid rising network difficulty and slower Bitcoin price growth. With mining rewards halved every four years (most recently in April 2024), miners are earning fewer BTC while needing to maintain, or even expand, their operations to stay competitive.
This squeeze has intensified following the 2024 halving event, forcing miners to either find cheaper electricity, improve hardware efficiency, or exit the market altogether.
What’s Next for Miners?
The immediate future looks uncertain for public miners without cost advantages. Those with higher operational costs may be forced to liquidate assets, consolidate, or shut down operations entirely if conditions don’t improve.
However, the upside for survivors is potential market share gain. As weaker miners exit, hash rate pressure could ease slightly, and profitability might improve. Long-term, the market favors low-cost, energy-efficient mining operations that can weather these lean cycles.
Investors and analysts will be closely watching how this plays out, especially as Bitcoin’s price remains volatile and mining economics shift dramatically.
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