Bitcoin mining profitability won’t necessarily drop after the halving in two weeks. Although the block subsidy will decrease by 50%, this does not have to be fatal, according to Laurent Benayoun, CEO of Acheron Trading:

“Measured in dollars, it is not clear that miners would be worse off after the halving, on the contrary. The halving of the mining subsidy will be offset by an increase in the costs of the network.”

From (approximately) April 20, miners will no longer earn 6.25 BTC per block, but only 3.125 BTC per block (measured without the sum of the transaction costs of the block). However, Benayoun thinks that on-chain costs will increase again due to Ordinals and bitcoin-native DeFi projects.

“We’ve seen NFTs pop up on the bitcoin blockchain, and we’ve seen a number of projects trying to build DeFi on the network. All these elements therefore lead to an increase in network costs.”

Transaction costs

The average transaction fee is currently $4.88, compared to $16.13 per transaction a month ago. In addition, the dollar price of bitcoin is also important. The higher it is, the easier it is for miners to operate profitably. Joe Downie, CMO of NiceHash, tells Cointelegraph:

“If the price stays above $70,000, most miners will remain profitable, as with the current block rewards they are profitable at a BTC price above $35,000… Less than that and they are likely losing money.”

Many miners have already prepared for the halving (which was inevitably coming) by investing in new mining hardware. Companies that did not do this will have a hard time, says Benayoun of Acheron Trading:

“We saw in previous cycles in 2017 and 2021 that less efficient miners went bankrupt. I don’t think that will be the case this time, because of this increase in network costs.”


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