Bitcoin miners are struggling with increasing production expenses and unpredictable Bitcoin prices, which hinders their ability to generate profits. The mean expense of extracting a single Bitcoin amounted to $83,668, however, it experienced a marginal decline to approximately $72,000 by July 2nd.
The exorbitant expenses associated with mining have posed a significant challenge for numerous miners to maintain profitability, particularly given the fact that Bitcoin prices are in close proximity to these production costs.
According to CoinShares data, the price of Bitcoin was close to the average cost of production during the April halving event. Out of the 14 miners, half of them had expenses that were higher than the average.
F2Pool has verified that only ASIC computers with an efficiency of over 23 W/T were generating profits as of July 4th. In order to generate profit, other machines required Bitcoin prices to exceed $51,456. On July 5, there was a significant decrease in mining difficulty.
This could potentially increase the profitability of additional machines, specifically ASICs with a unit power of 26 W/T or below. It is anticipated that these machines would become viable if the price of Bitcoin reaches $54,000.
According to recent estimates, Bitcoin miners are approaching levels of surrender, where they are shutting down machines that are not making a profit and selling around 30,000 BTC, which is worth $2 billion, in the previous month.
According to Con Kolivas from Solo CKPool, miners who are not making enough profit are either shutting down unproductive computers or exiting the sector. A considerable number of miners persisted for a longer duration than anticipated, with the anticipation of a substantial price surge that would offset their expenses.
The Bitcoin mining sector is confronted with significant economic obstacles as a result of exorbitant production expenses and unpredictable Bitcoin pricing.