Originally published on: July 31, 2024
Bitcoin miners are experiencing a welcome relief in July as the cryptocurrency’s price surge has alleviated selling pressure and led to increased mining activity.
Hashrate Recovery Boosts Miner Revenue
A recent report by CryptoQuant highlights that miners are now selling less Bitcoin as their daily revenues have surged by nearly 50% since early July. This uptick in revenue is attributed to the recovery in Bitcoin’s price, which has witnessed a gain of nearly 6% over the past 30 days, currently trading around $66,500.
Hashrate Increase and Reduced Selling Pressure
The report reveals that as of July 29, miners’ hashrate reached 604 exahashes per second (EH/s), marking a 6% increase since hitting its lowest level earlier in the month. This improvement in revenue has translated into a decrease in BTC sales stemming from miners’ reserves, indicating a reduced selling pressure amidst price recovery.
Impact on Miner Balances and Transactions
While overall miner outflows have diminished in recent weeks, not all miners are benefitting equally. Larger miners have been seen increasing their BTC holdings, with their total balance standing at 65,000 BTC as of July 29. In contrast, smaller miners have experienced a decline in their BTC ownership, now holding 51,000 BTC compared to 59,000 BTC at the start of 2024.
Challenges Faced by Miners
Despite the positive developments, miners are cautious about the sustained profitability of mining operations. Transaction fees currently account for 1.72% of total mining revenues, the lowest level since October 2023. With fees remaining low, mining profitability becomes overly reliant on the price of Bitcoin, posing a potential risk for miners.
Looking Ahead: Enhancing Mining Profitability
As Bitcoin mining continues to evolve, miners must adapt to changing market dynamics to ensure long-term sustainability and profitability. By optimizing operations and closely monitoring revenue streams, miners can capitalize on market opportunities and navigate potential challenges within the crypto landscape.
