Bitcoin’s hashrate surged past 600 exahash per second (EH/s) this week, briefly reaching a peak before stabilizing at 598 EH/s. The hashprice, which indicates the expected value of 1 petahash per second (PH/s) of hashing power per day, stands at approximately $57 per petahash.
Increased Centralization in Bitcoin Mining
As of 12 June 2024, Bitcoin (BTC) miners have earned roughly $410.5 million, with $65.62 million attributed to on-chain fees. June has presented significant revenue challenges for BTC miners, with earnings at risk of being among the lowest of the year unless Bitcoin’s price increases. Following the recent halving, miners now receive 3.125 BTC per block, down from 6.25 BTC, plus fees.
From 12 March to 21 April, Bitcoin miners earned at least $100 per petahash daily. One petahash equals 1,000 terahash per second (TH/s) or 1 quadrillion hashes per second (H/s) of computing power. Approximately five Bitmain Antminer S21 units, each generating 200 TH/s, are required to produce a single petahash. Between 1 May and 12 June, the hashprice fluctuated between $44 and $57, peaking at $94 per petahash on 8 June.
Impact on Miner Competition
The decrease in revenues has pressured miners, weeding out weaker participants and strengthening the more robust ones. Despite a slight drop from its peak, mining pool centralization has significantly increased. Foundry USA and Antpool now control 54.3% of Bitcoin’s global hashrate, with Foundry alone accounting for 28.3% or 169.55 EH/s.
To put this in perspective, Foundry’s share equates to 169,550 petahash or 169 quintillion H/s. At a rate of $57 per petahash, daily earnings would be around $9.66 million. However, producing this output requires approximately 847,750 S21 miners. As the Bitcoin mining landscape evolves, the growing consolidation of power among major mining pools will likely continue to draw attention.
Adapting to a Competitive Environment
The fluctuating hashprice and this year’s halving of block rewards have intensified economic pressures on miners, fostering a more competitive environment. Moving forward, miners’ resilience and adaptability will be crucial in navigating profitability uncertainties. Essentially, only the most technologically advanced and cost-efficient miners will thrive, reflecting the principle that only the fittest survive in a constantly changing environment.
