Bitcoin Mining Revenue Reaches Yearly Low
07 May, 2024 ● Crypto News
Earnings from Bitcoin mining experienced a substantial decline in May due to the impact of the fourth Bitcoin halving event.
The Bitcoin halving mechanism is designed to gradually reduce the issuance of the total 21 million Bitcoin over several decades.
The April 20 halving event cut mining rewards from 6.25 BTC to 3.125 BTC.
Although initial enthusiasm around the halving and the launch of Bitcoin Runes temporarily maintained miners’ daily earnings, a significant drop in revenue was recorded in May.
On May 1, total revenue from block rewards and transaction fees fell to a new low of $26.3 million.
In comparison, Bitcoin miners earned approximately $6 million per day on average before the halving, according to data from Blockchain.com.
The other days in May followed similar revenue patterns, indicating a new norm in Bitcoin mining revenue.
Notably, mining revenue peaked on April 20, hitting an all-time high daily earning of over $107 million for the first time in Bitcoin history.
In anticipation of this significant revenue drop, miners worldwide adjusted their operations to remain profitable in the new phase of the Bitcoin economy.
Without these adjustments, miners would have to depend solely on Bitcoin’s high market value to sustain operations.
CryptoQuant CEO Ki Young Ju estimated that Bitcoin needs to stay above $80,000 to keep mining profitable post-halving under current conditions.
Nevertheless, most miners took proactive steps to upgrade their mining equipment to reduce long-term operational costs and stay competitive.
For instance, Bitcoin mining company Bitfarms allocated $240 million to triple its hash rate. Bitfarms CFO Jeffrey Lucas explained the firm’s efforts to acquire 88,000 highly efficient Bitcoin miners:
“The transformational fleet upgrade propels Bitfarms in scale and profitability amid the Bitcoin halving. This is a game changer that triples our hash rate to 21 EH/s, increases our targeted operating capacity by 83% to 440 megawatts (MW), and improves fleet efficiency by 40% to 21 w/TH.”
Despite these efforts, Bitfarms recorded its lowest monthly earnings of 269 Bitcoin in over two years in April.
Sources:
https://cointelegraph.com/news/bitcoin-mining-earnings-post-halving
