On-chain data shows Bitcoin miner revenues have now declined to six-month lows as the price of the crypto has continued to struggle recently.
Bitcoin Miner Revenues Fall To 6-Month Lows
As per the latest weekly report from Arcane Research, the BTC miner revenues have now dropped to lows not seen since six months ago.
Over the course of the year 2021, the Bitcoin miners enjoyed some super high profits. There were two main reasons behind their amazing revenue during the period.
The first was the high BTC price. During the year, the crypto achieved two different all-time highs, and was generally in a state of uptrend except for a few stretches.
Because of this, whatever revenue Bitcoin miners gained also went up in value, and kept them in a state of high profit.
The other reason was the hashrate crash due to China’s crackdowns on mining. The “hashrate” is an indicator that measures how much computing power is currently connected to the BTC network.
With this metric, it’s possible to tell how much competition miners are facing right now. The more the Bitcoin hashrate value, the harder the competition miners face, and the lesser are their profits.
Now, here is a chart that shows the trend in the BTC hashrate over the past year:
Looks like the value of the indicator has been going up for a while now | Source: The Arcane Research Weekly Update - Week 4
As you can see in the above graph, the hashrate crashed in June. In the period of low hashrate that followed after, miners outside China started enjoying even bigger profits since the mining difficulty of Bitcoin dropped a lot.
However, over the months the indicator completely recovered from the crash and is now currently sitting around a new ATH.
At the same time, BTC’s price has started struggling as it has crashed below $40k. These two factors combined have meant the profits for these miners have seen a significant reduction.
BTC Miner profits currently sit at six-month lows | Source: The Arcane Research Weekly Update - Week 4
If the hashrate continues its uptrend and the price of Bitcoin also doesn’t see any significant recovery, the mining profits will also continue to go down in the near future.
At the time of writing, Bitcoin’s price floats around $38.5k, up 1.5% in the last week. The below chart shows the trend in the price of the crypto over the past five days.
BTC's price has moved sideways around the $38k mark in the last few days | Source: BTCUSD on TradingView
Featured image from Pixabay.com, charts from TradingView.com, Arcane Research