Bitcoin miners are reporting dropping revenues across the board due to the halving event that occurred in April. Now that it has been over a month since Bitcoin halving, miners are expectedly receiving lesser rewards from the Bitcoin network, compared to what they earned over the previous four years.
Halving on the Bitcoin network happens once every four years or after every 210,000 blocks, cutting the block rewards miners receive for mining blocks by half. Four halvings have occurred so far – the block rewards after the latest halving reduced to 3.125 BTC from 6.25 BTC. The halving mechanism lets BTC remain deflationary and witness robust price growth alongside other supporting factors.
Consequently, Cipher Mining, a mining firm, observed a 43.9% decline in the BTC it earned in May compared to April. It mined 166 BTC in May and 296 BTC the month prior, April. Still, Cipher maintains positive net cash flows and is taking measures to compensate for this reduction in mining rewards by expanding its mining territory and equipment. A step that will allow it to mine more blocks in the future.
This move is not just isolated to Cipher. Marathon Digital is also making tremendous strides to expand by remaining active in the mergers & acquisitions (M&A) space and acquiring other mining outfits. Marathon reported a decline of 27.5% in May as its reward accrual reduced from 850 BTC to 616 BTC. It fared better than most of its competitors as it worked to mine more blocks than it previously did.
Stronghold Digital Mining stated that it witnessed month-over-month declines of over 47% from April to May. It mined 82 BTC in May and 155 BTC in April. It reported revenues of $5.2 million in May, showcasing a decline of 46%. Other mining firms like Riot Platforms and CleanSpark also witnessed similar drops in their mining reward accrual and revenues.
The Bitcoin mining ecosystem expected it with the halving and thus began preparations much earlier. The preparations include consolidating mining operations through M&A and expanding to overseas territories for more efficient energy supplies.
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