Bitcoin Hashrate Reaches New High of 700 EH/s Amid Low Mining Profitability
Bitcoin’s network has achieved a new milestone, with its seven-day average hashrate reaching 700 exahashes per second (EH/s). This record-breaking figure represents a big increase from the previous high of 677 EH/s, which was surpassed late last week and continued to climb over the weekend.
The surge in hashrate comes at a time when bitcoin mining profitability, or "hashprice," remains relatively low, hovering around $40 per petahash per second (PH/s). Despite this, the rising hashrate indicates that mining operators are not yet capitulating, even as the industry faces economic challenges.
The current low profitability, compounded by the recent bitcoin halving, has led to a wave of mergers and acquisitions within the mining sector. Last week, the hashprice dipped to $38/PH/s following a market correction, putting additional pressure on operators. Many smaller mining companies have been forced to consolidate or exit the market, while larger players are leveraging their resources to weather the downturn.
Publicly traded mining companies are at the forefront of this increased hashrate. Data from 16 such operators shows they collectively accounted for 22.76% of bitcoin mined in August, the highest market share recorded by industry analysis platform TheMinerMag. These companies, including major players like Marathon Digital Holdings, are using their market dominance to boost operations, even in the face of lower profitability.
Bitcoin Holdings and Market Dynamics
These publicly traded companies have also been increasing their bitcoin holdings, with their combined reserves reaching nearly 60,000 BTC by the end of August. Marathon, in particular, has been aggressively purchasing bitcoin using proceeds from convertible notes issued last month, bolstering its position in the market.
This increased concentration of mining power among a few large operators is reshaping the landscape of the industry. While smaller players are struggling, the larger firms continue to expand their operations and holdings, betting on a future rebound in bitcoin prices.
As a result of the hashrate surge, bitcoin’s mining difficulty is expected to increase by 4.54% in 17 hours. This adjustment will make it even harder for miners to find blocks and earn rewards, further straining profitability. If the current market conditions persist, the hashprice could reach new lows, putting additional pressure on mining operators.
September has so far been marked by bearish sentiment, and with bitcoin prices showing little sign of recovery, mining profitability may continue to decline. However, the hashrate's continued growth suggests that large operators remain committed to expanding their operations, even in the face of economic uncertainty.
Read More
Latest
