The Bitcoin miners have been going through a rough phase as the network hash rates previously had shown a consistent rise followed by a slight decline recently hoping to bring some relief to them. However, recent data suggests that the miners and their incomes have continued to struggle.
Data from Arcane Research’s report shows that the miners’ struggle has worsened this week as their revenues have dropped by almost 15%. The daily miner revenue is a metric that is calculated by multiplying the total amount of Bitcoin that miners have earned in blocked rewards and transaction fees per day with the current prices of the crypto.
According to data, the daily miner revenue’s 15% drop this week has plunged it to $16.3 million. Here, the revenues highly depend on the crypto prices and the transaction fees per day as they are variable whereas the block rewards(number of Bitcoins) are mostly fixed. However, the transaction fees in the network have been at low levels for a while now making up a small percentage of the total mining revenues. Hence, the Bitcoin prices ultimately become the biggest factor influencing the miners’ revenue.
Further data also reveals that the revenue drop in the past 7 days was in a time when the fees per day rose by 2.2%, taking the value to $348,500 but it only constitutes 2.1% of the total revenues, the surge couldn’t compensate for the price crash implying a negative value on the revenue.
The miners in recent times have been under extreme pressure due to several factors like the prolonged bear market, rising energy prices, etc. The long bear phase has kept the prices low for a while and with the recent market crash, the miners’ profits have stooped to low levels. Energy prices are a significant factor affecting miners’ profits as it constitutes a major operational cost.
With the ongoing geopolitical tensions between Russia-Ukraine, the global energy supply has taken a big hit significantly affecting their revenues and even making the activity unfeasible for some. Also, the miners’ revenue decline has affected some to a level that a lot of miners are selling their reserves at a rapid rate as reported by Todayq.
At the time of writing, Bitcoin is trading at $16,576.10, which is a 0.42% drop from the previous day and about a 1.20% drop over the past 5 days.