The Bitcoin bull run has not only been profitable for the retail traders and high-net investors but also for the miners of the network as well. In yet another major development, Bitcoin mining revenue has climbed all the way to a whopping $21 million per day. With this, the revenue figure has reached its highest level this year.
The last time, revenue for the Bitcoin miners reached this level was back in September 2018 when Bitcoin was trading above $10K. Blockchain.com tracked the total value of Coinbase block rewards and transaction fees paid to miners and found the daily revenue figure, which includes block rewards and transaction fees, reach a record high,
To top that, the data from the crypto analytics platform, Glassnode, indicated that revenue figures appeared to have also crossed the pre-halving levels. Before the halving event in mid-May 2020, Bitcoin’s price was near $9,000. Six months later, the cryptocurrency shot up to $18,000. This was indicative of the correlation as miners need to sell enough of the coins to cover the costs of mining while simultaneously maintaining a profit. With the price reaching highs prices mean greater profits.
Bitcoin’s Capitulation Scares
After a gradual rise at the beginning of the year, Bitcoin had trimmed substantial gains in a sudden sell-off sparked by the COVID-19 pandemic and the increasing global tension. During this time, several theories of miner capitulation emerged as the impact of downward price action on miner operations, signaled that more miners were capitulating during Black Thursday.
Miner’s profit margins rely on the current market value of the cryptocurrency as well as the current cost of energy and other operational expenditures. Hence, The higher the price of Bitcoin and the lower the operating expenses, the better the margins and, therefore, the more profitable the business is.
As the market collapsed, Bitcoin’s price fell so low as it broke under $4,000 abruptly, that it immediately began causing miners in the network to capitulate in the days following.
Outdated Mining Rigs Back On
Amidst the ongoing bull run, several old and outdated ASIC mining rigs started to become profitable yet gain. Miners China had reportedly resumed utilizing their old mining equipment manufactured by industry against such as Canaan, Bitmain, and others. These have found outdated rigs include the Antminer S9 (10-16 TH/s) which have once again started to procure profits.