Bitcoin’s fall from its all-time excessive to a low of $15,700 has been one of the vital dominating narratives this yr. Bitcoin misplaced 75% of its worth since Nov. 10, 2020, and over 65% for the reason that starting of the yr.
Nonetheless, a way more outstanding story than Bitcoin’s volatility is the divergence between its worth and its hash fee.
Regardless of shedding three-quarters of its worth in a yr, Bitcoin’s hash fee reached its all-time excessive of 271.8 EH/s. This divergence between the hash fee and the value is a singular prevalence that hasn’t occurred in any of the earlier bear markets.
The skyrocketing hash fee turns into an excellent larger outlier when evaluating it to miner revenues. CryptoSlate beforehand analyzed miner income and located that income proceed to lower even for the biggest and most effective mining operations.
CryptoSlate’s evaluation of two widespread Bitmain miners paints a bleak image of the mining trade. Wanting on the Antminer S9 and Antminer S17 exhibits that machines are combating profitability.
Launched in 2017, the Antminer S9 remained worthwhile all through years of market volatility. Nonetheless, as the worldwide hash fee started to develop in 2020, the S9 noticed its profitability fall till it lastly turned unprofitable in Might 2022, when nearly all machines have been faraway from the community.
With an all-in-sustaining value of round $0.05/kWh, Bitcoin’s worth would wish to surpass $19,000 for the Antminer S9 to develop into worthwhile once more.
The Antminer S17 remains to be worthwhile. Launched in 2019 as a extra highly effective iteration of the S9, the S17 produced a most hash fee of 56 TH/s. Bitcoin’s present worth and rising hash fee put the profitability of the S17 at simply $36 per day. This slim revenue has been lowering nearly every day and is anticipated to drop even additional within the coming weeks.
The S17 has been combating profitability all year long. The Terra collapse in June 2022 made the S17 unprofitable for the primary time ever, as Bitcoin dropped properly under $16,000 wiping out billions from the market.
The continued market volatility, mixed with the ever-expanding hash fee, is presently placing the profitability of the S17 into query. Wanting on the profitability chart for the S17 exhibits that the machine is experiencing a pattern much like the S9.
Barely breaking even, the S17 would develop into unprofitable if Bitcoin have been to fall underneath $15,500. Crossing the $15,500 may push miners to unplug 1000’s of S17s.
