Bitcoin (BTC) The bear market has been tough for miners, whose profit margins have shrunk as prices have fallen more than 50% this year, energy prices have risen and capital has dwindled.
Shares of Bitcoin (BTC) Miners Have Dipped More than 70% on Average This Year, According to FactSet Data
Due to these decreases, the bitcoin mining data center Compute Northfiled for bankruptcy last month, citing a severe bear market, supply problems and capital shortages.
Due to the high network Hashrate and difficulties, the problems experienced by the industry are expected to increase further.
Ethan Vera, operating manager of mining services firm Luxor Technologies, said:
“While the hash price is in the $80/PH/Day range, this difficulty increase will be very frustrating for miners and will reduce their income by 10%.”
Hash price refers to a metric invented by Luxor that measures revenue per Terahash of computing power for miners.
Stating that miners with high debt burden and costs are at much greater risk in this environment, Vera added, “If the hashprice, difficulties increase or the Bitcoin price continues to decline, we will likely see more troublesome situations arise in Q4.”
However, according to Chris Brendler, an analyst at Wall Street investment bank DA Davidson, the survivors will continue to thrive as weaker miners pull out of the market.
*Not investment advice.
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