Bitcoin Mining Difficulty Soars Amid Sector Challenges

Bitcoin mining difficulty surged 3.6% to reach an all-time high on Wednesday following record hash rate levels over the weekend.

What's the Scoop?

• Hash Rate Surge: The total computational power used by Bitcoin miners, called the hash rate, hit a new record of 694 exahashes per second (EH/s) over seven days, meaning miners use more power than ever to compete for new blocks.
• Mining Revenue Decline: Miners have faced a sharp drop in revenue since Bitcoin’s halving event, with the seven-day average now in the $25-30M range compared to $72.4M before the halving.
• Hash Price Impact: Hash price, which measures mining profitability per terahash, a unit of computational power, fell to all-time lows of $0.04. Miners earn $0.04 per terahash daily, not per Bitcoin, meaning profitability drops without efficient equipment and low energy costs.

Bankless Take:

The drop in hash price highlights how tough the market has become for smaller miners, with larger, more efficient operations dominating the space — a dynamic contributing to miner mergers and acquisitions surging and mining firms diversifying to also provide cloud compute. As Bitcoin’s hash rate continues to climb, only those with the most advanced rigs and access to cheaper energy will stay profitable, potentially leading to further consolidation in the industry. The rising difficulty and falling profitability might continue to push out less efficient players, particularly in regions with higher energy costs.

Swan Plans to End Mining Operations, Drops IPO Plans on Bankless

Miners continue to face profitability challenges and the market consolidates post-Halving.

BanklessJack Inabinet