Miners were the talk of late 2021 with a certain way to make money: link powerful computers up to cheap power, solve tough maths challenges, and sell newly created coins on the burgeoning market.
Blockchain.com reports that bitcoin mining revenue has plunged 72% to $17.2 million a day amid a crypto winter and global energy crisis from $62 million a day in November.
"Bitcoin miners have continued to watch margins compress - bitcoin's price has fallen, mining difficulty has increased, and energy prices have soared," said Blockware Solutions lead analyst Joe Burnett.
This puts pressure on players who acquired expensive mining equipment, hoping bitcoin prices will rise to recover their investment. Since August, Bitcoin has failed to break over $25,000 or regain November's all-time high of $69,000.
As more miners join, solving riddles to mine tokens becomes harder. This increases processing power consumption and running costs, especially for those without long-term power pricing agreements. Since July, Bitcoin miners' profit per terahash per second of computing power has ranged from $0.119 to $0.070 a day, down from $0.45 in November and near its two-year low.
The last bitcoin will be mined in 2140, more than a century away, and mining offers intriguing spy opportunities in the dark. "The best time to get in is when market's low, the same mining rigs that went for $10,000 earlier this year you can get that for 50% to 75% off right now," said Sazmining Inc. CEO William Szamosszegi, who plans to establish a renewable-energy bitcoin mine.
Many miners are buying fewer rigs, pressuring manufacturers to lower pricing. Luxor researchers said that bulk purchases of some mining machines had dropped 10% in the preceding week and that the popular S19J Pro rig currently sells for $3,200, down from $10,100 in January.
Crypto investment platform Bitcoin IRA co-founder Chris Kline said miners must be "hyper-focused" on energy efficiency to reduce costs and avoid climate change legislation. "From managing their balance sheet, processing units and energy costs, miners will look to stay afloat regardless of current market conditions," said.
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