The first quarter balance sheet for bitcoin miners was negative in terms of profitability, but picked up momentum in April. The surge in the coin price along with the availability of equipment bought or retired in the worst months of 2022 in terms of profit created the current economic conditions in the industry.
In accordance with Pay According to the Hasrate Index, the computing capacity of the network has grown by 30% since the beginning of the year. This corresponds to a growth of 95 EH/s at the time of writing this note.
The main driver behind this growth is the 45% surge in Bitcoin (BTC) price in the first two months of the year, from $16,688 to $24,800 in mid-February. Back then, Bitcoin’s hash price, an indicator used by network miners to estimate their earnings, increased to 0.082 USD/TH/day (or 82 USD PH/day), its highest level in the first quarter. Then the setback began, as CriptoNoticias reports.
The Bitcoin hash price is a value assigned to a unit of account. It is represented in dollars (USD) and is estimated based on the amount of hashrate that a mining operation contributes to the Bitcoin network in a day.
As a result of Bitcoin’s increased profitability, more miners started plugging in their devices, and the level of Bitcoin mining difficulty has been adjusted to current levels, the highest in Bitcoin history. The gradually decreased the hash price with each new difficulty level.
In fact, if we take the highest point of the hash price in the first quarter and compare it to the current one, the decrease corresponds to 23%, as it is now at 0.074 USD/TH/day. The same value he experienced at the end of March. However, this same number represents 10% more than the profitability registered in the first days of January.
In the first quarter, Bitcoin (BTC) price surged by as much as 70% compared to January. However, competition among miners for the reward, growth in hashrate, and difficulty halted what appeared to be a bullish rally in mining profitability.
At the beginning of the second quarter, the hash price reached the 0.083 USD/TH/day mark. However, after three difficulty level adjustments, each setting a record for this parameter, profitability dropped to $0.074/TH/day.