Bitcoin Mining Becomes Unprofitable as BTC Price Falls to Average Mining Cost

0

A year ago, following China’s crackdown on cryptocurrency mining facilities, mining Bitcoin (BTC) became easier and more profitable. More than half of the hashrate, or processing power, of the Bitcoin network has fallen since the market peak in May 2021 due to the Chinese government’s mining restriction.

Despite this, Bitcoin mining is no longer profitable for miners, according to Data of the cryptocurrency analysis platform CryptoRank published on June 17.

This is due to the collapse that occurred in the cryptocurrency market, which caused the price of Bitcoin to fall to a level not seen in the last 18 months and led the Flagship digital asset struggling to hold support above critical $20,000. level.

Since the price of Bitcoin fell at the average cost of mining, the platform said:

“Due to a significant decline in the price of BTC over the past few months, mining has become less profitable. For some Bitcoin miners, it might even be unprofitable at the moment.

BTC price vs mining cost. Source: CryptoRank

Bitcoin Mining Stocks See Slow Growth

It’s worth mentioning that Finbold reported earlier this week that cryptocurrency and bitcoin mining-related stocks saw slower growth in May along with Marathon Digital Holding (NASDAQ:MARA) and Riot Blockchain ( NASDAQ: RIOT) in the lead.

As the debate between lawmakers from different countries, states and cities rages over the environmental effects of Bitcoin Proof-of-Work (PoW) mining. On June 16, a group of members of the United States Congress sent a letter to the country’s Environmental Protection Agency (EPA), explaining that the practice actually has some benefits.

It is important to note that PoW cryptocurrencies have come under a lot of criticism due to the huge amount of electricity required to mine them, unlike Proof-of-Stake (PoS) assets, which are considered more environmentally friendly. .

As a result of the dispute, authorities in some regions even recommended banning the use of the PoW method outright. Recent events have seen a similar ban approved by the New York State Senate, but the European Union Parliament voted against it.

Share.

Comments are closed.