Hash rate and difficulty, two of the most fundamental metrics of the Bitcoin network, have both peaked.
Unfortunately for miners, the price of the largest cryptocurrency in the world has not recovered. The price per terahash of bitcoin hashing power, or “hash price,” has fallen to lows not seen since the spectacular collapse of FTX in November 2022.
Income Drops for Bitcoin Miners
Bitinforcharts data shows that Bitcoin mining earnings has fallen to $0.058 per terahash per second per day, down by nearly 50% from May’s Ordinal-driven frenzied high of $0.118.
Hash price, also known as miner revenue, rises and falls in tandem with fluctuations in Bitcoin price and the volume of Bitcoin transactions. Dollar-valued awards per TH/s are proportional to the price of bitcoin and the amount of transactions. On the other hand, changes in the hash rate/mining difficulty are negatively correlated with the hash price.
Miners’ Plight Worsens
Miner profits have dropped in recent days, right after the network difficulty peaked at 55.62 trillion hashes while Bitcoin’s price remained stagnant at $26,000. A spokeswoman for Bitfinex told CryptoPotato that miners believe the current Bitcoin price reflects a discount from the flagship cryptocurrency’s genuine value.
A low selling rate from miners may be due to their belief that Bitcoin is currently properly valued or even somewhat underpriced compared to its genuine value.
As this is just a temporary dip in value, miners may be assured that Bitcoin’s price will rise again. Therefore, at these prices, it may be quite beneficial for them to invest additional resources into Bitcoin mining.
As the Bitcoin price drops, miners must decide whether to hang onto their BTC or sell it to keep their profit margins intact. If miners begin selling off their tokens, it might aggravate the market situation and push the price of Bitcoin further down.
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