Bitcoin Mining Profitability is <5% Away from All Time Low

Decrypt’s Art, Fashion, and Entertainment Hub. Although the Bitcoin network’s fourth ‘halving’ event occurred more than two months ago,

Bitcoin miners continue to face lower profitability despite the recent price rally, with the daily “hash price” now just 5% away from all-time lows.

Bitcoin mining profitability has been on a steady decline throughout 2024, reaching new lows as the year has progressed. Now, fresh data shows that the daily “hash price” is just 5% away from making new all-time lows.

According to data from Hashrate Index on June 26, Bitcoin’s daily hash price now sits at $48.29 per petahash per second (PH/s). This metric quantifies how much money a miner can expect to earn daily at a specific hash rate.

Bitcoin “hash rate” is the rate at which Bitcoin miners can produce guesses to solve the mathematical problems required to mine a Bitcoin block and earn freshly printed BTC as a reward. One petahash equals one quadrillion hashes.

The daily hash price hit an all-time low on May 1 when the metric fell to $44.76 per PH/s. At the time, Bitcoin’s price had fallen to lows of $30,000 following a brief rally up to $34,000.

However, as Bitcoin’s price recovered throughout June, rising back up to $32,000, the daily hash price also saw some improvement. For instance, on June 10, the metric rose to highs of $53.86 per PH/s.

Related: Bitcoin mining difficulty sees largest negative adjustment in 2024

After June 10, the daily hash price began trending lower once again, eventually reaching $48.29 on June 26. This marks a 10% decrease from the June highs.

With the daily hash price continuing to fall, it appears that Bitcoin miners are slowly approaching the point of unprofitability, especially considering the specialized computer equipment and power-hungry nature of the mining process.

As global competition grows over time, especially with the rising hashrate, the profit margins for individual miners are shrinking, pushing all but the most efficient firms into net losses.

Bitcoin mining profitability is <5% away from all time low.

Can you guys please start inscribing, shitcoining, sniping..... literally anything. pic.twitter.com/gLstelZqGW

— cbspears ◉ (@cbspears) June 26, 2024

To participate in the Bitcoin mining game, miners require specialized and power-hungry computer equipment, along with access to affordable electricity to keep their mining rigs running.

As a result of the lower profitability, many Bitcoin miners have begun selling more BTC to exchanges this month, according to analysis from CryptoQuant on June 26.

This behavior suggests that miners may be covering their costs or preparing for lower prices in the future. For example, Marathon Digital (MARA) had sold 1,400 BTC in June as of June 10, compared to only 390 BTC throughout all of May.

However, despite the lower profitability and the impact of the Bitcoin halving, miner stocks on the whole don’t appear to be suffering.

Although performance varies from company to company, the Valkyrie Bitcoin Miners ETF (WGMI) — which provides exposure across the Bitcoin mining industry — is up 25% over the last month, reaching a 2024 high in June.

By comparison, BTC is down 11% over the same period, and big-time Bitcoin investor MicroStrategy (MSTR) is down 13%.