Bitcoin miners see 3x profit margins despite higher network difficulty

Bitcoin miners are seeing a threefold profitability margin despite rising network difficulty, according to data from Glassnode. 

New results from the Bitcoin (BTC) Difficulty Regression Model estimate the cost to mine a single BTC at approximately $33,900, while the cryptocurrency’s price hit $105,578 on Jan. 21. 

However, this profitability margin is still suppressed by growing competition among miners, with hashrates steadily climbing amid this bull run. According to Glassnode data, revenue per exahash stands at $60,800. Miners’ cash flow per mined block was reduced in April when the Bitcoin halving slashed revenue from 6.25 to 3.12 BTC.

According to CoinWarz, the Bitcoin hashrate stood at around 600 exahashes per second (EH/s) a year ago; now, it’s generally ranging between 700 EH/s and 900 EH/s as more participants join the mining pool.

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Mining is key to the security and functioning of the Bitcoin network, and miner resilience has proved beneficial — not just to Bitcoin but to energy grids overall. As Cointelegraph reported, Bitcoin miners saved Texas $18 billion by eliminating the need for new gas peaker plants and acting as a grid stabilizer.

With declining revenue and increasing competition, miners moved to diversify their activities in 2024 into high-performance computing (HPC) and artificial intelligence businesses. Hive Digital, for instance, repurposed part of its Nvidia machines for AI applications over the past year, generating over $2 per hour in revenue compared to $0.12 per hour from crypto mining.

Bitcoin miners are also stacking up their BTC reserves, following the playbook of companies like MicroStrategy. 

“In 2024, a notable shift emerged among Bitcoin miners, with many opting to retain a larger portion of their mined Bitcoin or refraining from selling altogether,” according to a report by Digital Mining Solutions and BitcoinMiningStock.io published Jan. 7.

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