How Bitcoin Mining Profitability Could Point To Capitulation Still Ahead

2022-4-20 20:00

Bitcoin mining profitability is subject to a number of things and recently these factors have been affecting mining profitability, hence putting it under pressure. The amount of money miners are making from carrying out their activities are low, contributed by the growing hashrate, mining difficulty, and last but not least, the price of the digital asset. As miners look to the future from 2022, what do they need to make their mining activities more profitable?

Bitcoin Mining Profitability Down

Bitcoin mining profitability has been heavily impacted by the declining prices of the digital asset. Looking at some of the most popular miners, the Antminer S9 and the Antminer S19, there is a clear indication that the profitability from mining activities has been declining.

Related Reading | Inside The Ethereum Foundation Treasury: What Does It Hold?

The Antminer S9 would cost a miner $26,000 worth of electricity to mine a single bitcoin, while its counterpart the Antminer S19 would cost $31,000 worth of electricity to give the same result. This is putting the price per kWh at $0.05. It means that electricity running costs alone are costing more than half of the realized revenue from mining a bitcoin. 

BTC mining profitability down | Source: Arcane Research

In total, an Antminer S9 would give a cash flow per BTC of around $15,000 going by the current price of the digital asset at $41,800. As for the Antminer S19, this number would come out to about $9,000 to $10,000 at current prices. 

What this shows is how the stagnating price of bitcoin is putting miners’ profitability under intense pressure. Coupled with the fact that the total network hashrate has skyrocketed since the China ban on mining, it has also had a negative impact on mining profitability. And if this does not ease up soon, it will continue to put significant pressure on profitability. The only way to then offset this pressure would be for there to be an increase in BTC’s price.

BTC price trending at $41,800 | Source: BTCUSD on TradingView.com

An obvious trend when mining profitability goes up is the rate at which miners build out their capacities. This was the case in the Autumn run when mining capacity had increased drastically, causing these miners to add to their existing capacity. It is expected that the space will begin seeing the evidence of this increased capacity in the coming months.

Related Reading | EU Citizens Strongly Oppose CBDCs, But What About Crypto?

Nevertheless, the price of BTC still remains the biggest factor in mining profitability. Regardless of how high the mining difficulty of the hashrate climbs, if the price of the digital asset is high enough to offset all running costs and return a healthy profit, then miners will see this pressure ease off.

Featured image from CoinDesk, chart from TradingView.com

Similar to Notcoin - Blum - Airdrops In 2024

origin »

Speed Mining Service (SMS) на Currencies.ru

$ 1.9622 (+0.00%)
Объем 24H $0
Изменеия 24h: 0.00 %, 7d: 0.00 %
Cегодня L: $1.9622 - H: $1.9622
Капитализация $205.406k Rank 99999
Доступно / Всего 104.68k SMS

mining profitability bitcoin low activities making miners

mining profitability → Результатов: 126


Bitcoin mining revenue continues to hike despite concerns over profitability

The importance of mining has never been questioned; Simply put, mining is the process of generating new Bitcoins in the network and facilitating transactions on the blockchain. Miners are rewarded for their efforts in BTC for the addition of a new block, but over the past few years, the profitability of mining has been under […] The post Bitcoin mining revenue continues to hike despite concerns over profitability appeared first on AMBCrypto.

2019-9-1 12:00


Фото:

Japanese IT Giant GMO Quits Selling Crypto Mining Equipment after Market Slump

Per a report published on December 25, 2018, Japanese internet giant GMO has decided to call off their business of manufacturing and selling cryptocurrency mining machines. Market Slump to Blame for Declining Profits According to the report, GMO’s in-house mining business profitability took a major beating due to the declining cryptocurrency prices.

2018-12-28 09:00


Фото:

No, Lower Bitcoin Price Won’t Start a Mining ‘Death Spiral’

A giant mining initiative sponsored by the government of Paraguay should quell fears the current Bitcoin price lows hurt the profitability of the practice. Golden Goose Will Have 15 Years’ ‘Guaranteed’ Power In a press release November 18, Korean Blockchain startup Commons Foundation confirmed authorities had “guaranteed” electricity for the Golden Goose project, which it says will be “the world’s largest cryptocurrency mining center and global exchange.

2018-11-26 14:00


Information from China Claims many Bitcoin Miners have shut down due to reduced hash rate. How Possible?

There has been news going around that major mining rigs in China have shut down as a result of reduced profitability due to reduced hash rate. According to the information, many miners say they have been mining at a loss for months but can no longer afford to continue because of increased electricity tariffs due […] The post Information from China Claims many Bitcoin Miners have shut down due to reduced hash rate. How Possible? appeared first on ZyCrypto.

2018-11-21 23:26


Фото:

DPW Holdings New Hydroelectric Dam Is A Crypto Mining Revolution

Valatie Falls Hydroelectric Dam, New York, is set to see a new life within cryptocurrency mining, after firm DPW Holdings Inc made a bid to purchase the aging dam in March 2018. This will see a new cryptocurrency mining branch open up within DPW Holdings, a brave move considering the falling profitability of cryptocurrency mining as a result of depleting values from currencies such as Bitcoin and Litecoin and of course, an increase in the price of energy and mining equipment.

2018-8-28 14:00