Miners make more than double what they did before the last halving. The Bitcoin hash rate has continued to expand, despite bearish market moments.
Despite the automatic reductions in BTC, Bitcoin miners today see a significant increase in their profits if they convert to USD. Miner revenues currently hover around $207,000 per exahash (EH) of power contributed to the network.
Bitcoin allocation gets halved for every 210,000 mined blocks, which gets achieved every four years, approximately. This action, which takes effect automatically in the Bitcoin network, is called halving.
The last Bitcoin halving took effect on May 11, 2020. The reward miners received for adding a new block of verified transactions to the blockchain was 12.5 BTC. After the halving, this incentive ended up being 6.25 BTC.
Although just after the decrease in block rewards, miners also experienced their profits decline at the end of 2020; the landscape started to bring various changes for these Bitcoin network workers.
In 2021 there were points in which Bitcoin miners’ income was even higher than the actual one. The earnings per exahash of power contributed to the Bitcoin network surpassed $400,000 multiple times.
Why are USD Bitcoin Miners’ Profits Going Through this Situation?
Some reasons have benefited the profit of Bitcoin miners, despite the decay in rewards on this network. The first of these reasons is the deflationary effect of the halving.
The fact that less availability of a resource makes it more valuable to those who own it than to those who wish to have it. Therefore, as less BTC gets mined, its supply gets reduced, and its market price theoretically enjoys more benefits. However, it is crucial to note that many causes impact the cost of an asset in the market, and scarcity is just one of these causes.
Another relevant situation that applies direct influence over the earnings of Bitcoin miners to look so bulky today is the price of BTC in the market.
Bitcoin Miners’ Profits are Higher Despite the Adversities
Bitcoin miners got favored by the rise of BTC in the market compared to the prices of two years ago and the development of more effective and efficient devices for mining. However, some factors work against them, such as the increasing difficulty of mining and the cryptocurrency market’s bearish waves.
Although the price of BTC is five times higher than two years ago, it is currently crumbling down. In the last week, the average cost of bitcoin fell from USD 46,000 to USD 40,000, equivalent to 15%. The current cryptocurrency market depends on the increase in the difficulty of mining, and the problem of mining in Bitcoin increases as the hashrate of the network increases.
By: Jenson Nuñez
