The post Bitcoin Miners Struggle Post-Halving: Will PlanB’s 2X Price Surge Save the Day? appeared first on Coinpedia Fintech News
Bitcoin miners are facing difficult times following the recent halving event, which has dramatically reduced their rewards to 3.125. This has led to increased financial pressure on mining operations. Despite the initial excitement that saw Bitcoin (BTC) reach an all-time high of over $70,000 in March, the current price struggles to hold at around $58,429, reflecting a slight decline in the past 24 hours.
Miner Rewards Plunge After Halving
Data from IntoTheBlock shows that the reward for Bitcoin miners has significantly dropped. In the 2020 halving, miners received 7,010 BTC, which was worth nearly $76 million at that time. However, in the recent 2024 halving, miners’ rewards have drastically decreased to 471.88 BTC, valued at just $28.1 million.
Adding to their challenges, the Bitcoin network’s hashrate has continued to rise. In 2020, the hashrate was 140.93 million terahashes per second (TH/s). Now, in 2024, it has surged to 695.84 million TH/s.
This increase reflects the heightened competition among miners and the need for more computational power, making mining even more difficult and costly.
Profitability Declines for Miners
A report from Jefferies, a Wall Street Bank revealed that mining profitability has also taken a hit. The average daily revenue per exahash dropped by 11.8% in August compared to the previous month, highlighting the increasing financial strain miners are experiencing due to fluctuating market conditions and rising operational expenses.
Bitcoin Price To 2x For Next Bull Run
PlanB, the creator of the Bitcoin Stock-to-Flow (S2F) model, shared his concerns about the future of Bitcoin miners. He stated that miners are still struggling with the impact of the halving and believes that the next major price surge, or “bull pump,” will only happen if Bitcoin’s price doubles.
Miners are still struggling with the aftermath of the halving. We need 2x current BTC price to kick-start the bull pump. pic.twitter.com/TmJEyI8L2d
— PlanB (@100trillionUSD) September 15, 2024
According to PlanB, BTC must reach at least $116,468 from its current $58,234 level to ignite the next bull run.
Solutions: Upgrading Mining Equipment
In response to declining profitability, many publicly traded North American mining companies are investing in new equipment to improve efficiency. These upgrades allow miners to double their hashing power without increasing energy consumption, which helps offset the economic challenges they face.
Marathon CEO Fred Thiel highlighted that upgrading systems, rather than expanding sites or adding power, is crucial for survival in the mining industry.
Innovative Approaches to Survive
Not all miners are struggling equally. For example, Core Scientific, which emerged from bankruptcy earlier this year, has adapted its infrastructure to support artificial intelligence and high-performance computing (HPC).
This innovative approach could provide a new direction for the industry as miners look for ways to overcome profitability challenges.
