Bitcoin miners are experiencing revenue declines as daily mining income has fallen to approximately US$30 million (AU$42.6 million) on a seven-day average basis. Bitcoin has traded below JPMorgan's estimated production cost of US$78,000 (AU$110,760) for five consecutive months, leaving roughly 20% of miners operating unprofitably. Mining difficulty has declined twice this year, and public mining companies sold more than 32,000 Bitcoin in the first quarter to fund continuing operations.
Mining Revenue Falls to US$30 Million Daily Average
Daily mining income has declined to approximately US$30 million (AU$42.6 million) on a seven-day average basis, down from more than US$50 million (AU$71 million) recorded last summer. Transaction fees now contribute less than US$250,000 (AU$355,000) each day, representing a minor component of overall mining earnings relative to block rewards.
Bitcoin Trades Below US$78,000 Production Cost for Five Months
Bitcoin has been trading around US$62,500 (AU$88,750), compared with JPMorgan's estimated production cost of roughly US$78,000 (AU$110,760). The cryptocurrency has remained below that production cost level for five consecutive months, the longest period of its kind during the current cycle. Previous market cycles have seen production costs act as a soft floor for prices.
Mining Difficulty Declines 10% in Second Week of June
Current market conditions have left about 20% of miners operating at a loss. Higher-cost participants have increasingly adjusted operations according to price movements, contributing to a stronger relationship between mining difficulty and Bitcoin's price over the past six months. The beta between the two measures has climbed to 0.62.
Mining difficulty fell around 10% in the second week of June. It was the second double-digit decline recorded this year, and both occurred during prolonged periods of below-cost pricing.
Public Mining Companies Sell 32,000 BTC in First Quarter
Public mining companies sold more than 32,000 Bitcoin during the first quarter, using the proceeds to fund operations amid compressed profit margins.
FAQ
What is the current daily revenue for Bitcoin miners?
Bitcoin miner revenue has fallen to around US$30 million (AU$42.6 million) per day on a seven-day average basis, down from more than US$50 million (AU$71 million) recorded last summer. Transaction fees currently contribute less than US$250,000 (AU$355,000) each day.
How long has Bitcoin traded below production costs?
Bitcoin has traded below JPMorgan's estimated production cost of US$78,000 (AU$110,760) for five consecutive months, with the cryptocurrency currently trading around US$62,500 (AU$88,750). This represents the longest period of below-cost pricing during the current market cycle.
How many Bitcoin did public mining companies sell in the first quarter?
Public mining companies sold more than 32,000 Bitcoin during the first quarter, using the proceeds to fund operations as approximately 20% of miners operate unprofitably under current market conditions.
