The crypto
mining sector witnessed significant economic improvements in December, with
mining profitability reaching its highest levels in seven months. The
hashprice, a key metric for daily profitability of the publicly listed Wall
Street Bitcoin Miners, increased by 5% since November’s end.
Wall Street Bitcoin Miners
Profitability Surges amid December Rally
Daily block
reward revenue has climbed to $57,300 per exahash per second (EH/s) in early
December, marking a seven-month peak, though still remaining 40% below
pre-halving levels. The network’s total hashrate has expanded 6% this month,
averaging 773 EH/s.
Certainly,
the ongoing rally in major cryptocurrencies is not without significance.
Bitcoin has climbed 40% since the beginning of November, testing
historic highs above $107,000. Meanwhile, altcoins, including the
BGB utility token, have surged by 120% this December alone.
“We
note miners earned about $57,300 in daily block reward revenue per EH/s over
the first two weeks of December,” analysts Reginald Smith and Charles
Pearce from JPMorgan wrote on Monday.
Wall
Street Bitcoin miners from the US have significantly strengthened their
market position, with their combined hashrate surging 94% year-to-date to 222
EH/s. These miners now control approximately 29% of the global network.
However, their aggregate market capitalization experienced a $1.5 billion
decline in December’s first two weeks.
Bitcoin Miners News: Behavior and
Revenues
Moreover, Bitcoin miners have substantially reduced their
holdings, selling over 140,000 BTC (valued at $13.72 billion) in December. This
has decreased their total holdings from 2.08 million to 1.95 million BTC.
Despite this significant sell-off, Bitcoin’s price has shown resilience,
experiencing only minor pullbacks.
So far in December, #Bitcoin miners have sold over 140,000 $BTC, totaling $13.72 billion! pic.twitter.com/1g3sCo6uJM
— Ali (@ali_charts) December 14, 2024
Mining
revenue has also reached impressive levels, with daily earnings touching
approximately $50 million, the highest since April’s peak of nearly $100
million. However, increased mining difficulty, now at 106T compared to April’s
85T, has created additional challenges for miners.
For
example, in November—when Bitcoin was also testing its all-time highs—eight
Wall Street miners reported
lower BTC production. Although these miners are continually expanding their
mining capacity, the increasing difficulty level makes it harder to boost
output. The higher the “difficulty” metric, the more computing power is
required to extract the same amount of cryptocurrency.
Why are Bitcoin miners
selling large amounts of BTC in December?
The primary
driver behind the selling appears to be covering regular operational expenses,
including electricity bills and other running costs. The selling has been
steady rather than panic-driven, suggesting a calculated approach to
maintaining operations.
Moreover, with
Bitcoin reaching new all-time highs above $107,000, miners are likely
capitalizing on favorable market conditions to secure profits. This timing
allows them to maximize returns on their mined assets.
Not
everyone is selling their Bitcoins, though. An increasing number of publicly
listed Wall Street Bitcoin miners are choosing to issue bonds or other debt
instruments to raise additional funds and build up their BTC reserves.
For
example, on Monday, Riot Platform purchased an additional 667 BTC at an average
price of $101,135. As a result, it now holds 17,429 BTC in its vault.
With the additional proceeds from Riot’s upsized $594 million, 0.75% coupon convertible bond issue, the Company has acquired 667 BTC at an average price of $101,135 per BTC. As a result, Riot has increased its holdings to 17,429 BTC, currently valued at $1.8 billion based on the… pic.twitter.com/t68Uy8nbHU
— Riot Platforms, Inc. (@RiotPlatforms) December 16, 2024
By
comparison, El Salvador, the first country to make BTC its official legal
tender, has accumulated just under 6,000 BTC.
This article was written by Damian Chmiel at www.financemagnates.com.
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