U.S. Bitcoin Miners See Significant Hashrate Growth Amid Profitability Challenges

U.S. Bitcoin Miners' Hashrate Surges

The collective hashrate of U.S.-listed Bitcoin miners tracked by JPMorgan has nearly doubled over the past year, reaching 244 exahashes per second (EH/s). This represents a 95% year-over-year increase, outpacing the global Bitcoin network's 45% growth. These miners now contribute approximately 29% of the global hashrate, signaling growing competition and mining difficulty.

Profitability Pressures Intensify

Despite the hashrate surge, Bitcoin's average price has declined since January, impacting mining profitability. The hashprice, a measure of daily miner profitability, dropped 13% since late January. This decline, driven by rising hashrate and falling Bitcoin prices, has reduced miners' earnings. Daily block rewards for February were estimated at $53,600, a 6% decrease from January.

Mining Stocks Show Mixed Performance

Individual mining stocks have experienced volatility. IREN saw a 27% gain in early February, while Greenidge Generation fell 20%. Overall, the total market capitalization of the Bitcoin mining stocks covered in JPMorgan's report dipped 1% month-over-month.

Industry Insights and Outlook

The findings align with a recent Bernstein report, which also highlighted the growing dominance of U.S. Bitcoin miners in the global network. As the hashrate continues to rise, miners face increasing competition and profitability challenges, making operational efficiency and cost management critical for sustaining operations.