The Bitcoin (BTC) miners and their profits are struggling with various issues all at once like a prolonged bear phase, increasing energy prices, high network hashrates, etc. The network hashrate was soaring at all-time high values followed by a slight decline in the value, however, the struggle doesn’t seem to ease.
As per recent data from Glassnode, the BTC miner hash price has dwindled to new all-time low values at $58.3k exahash per day. The miner hash price is a metric whose value is calculated by estimating the ratio between the daily miner revenue and the mining hashrate.
The daily miner revenue is calculated by multiplying the total amount of BTC that miners have earned in block rewards and transaction fees per day with the current prices of the crypto whereas the mining hash rate is referred to as the total computing power currently connected to the BTC network and is measured in exahash per second (EH/s).
Looking at the graph, it is clear that the BTC mining hash price ever since the creation of the crypto has been on a declining trend. The primary reason behind this consistent decline is the “mining difficulty”, a feature of the blockchain algorithm that ensures the chain validators mine at a constant, network-intended rate.
Every time the network’s hash rate surges, miners can produce blocks faster because of their computing power but that is something that the network’s algorithm doesn’t want. Hence, it increases the level of difficulty bringing the speed level to the desired levels.
Analysts suggest that the hash price depicts the income that miners can generate per unit of the utilized computing power every day. The declining hash prices signify that the miners can mine the same amount of block rewards irrespective of the high network hash rate.
Other factors affecting the miners’ revenue also include the halving that occurs every 4 years dividing the block rewards into half alongside the BTC prices that have a significant share in it. When the market is in a bull phase, the hash price breaks down the prevalent trend and shows a temporary surge.
The current scenario has been very harsh on the miners as the hash rates have increased while the hash prices have decreased. All of this has forced the miners to dump about 15% of their reserves in the past week as reported by Todayq.
At the time of writing, Bitcoin is trading at $16,576.80, a 0.62% drop from the previous day and about a 13.34% drop over the past month.