According to the latest Jefferies report, Bitcoin (BTC) mining profits fell in September while the network’s hashrate continued to grow.
Bitcoin Mining Profits In Downtrend
In a report published on Sunday, investment bank Jefferies explained that Bitcoin mining profits decreased in September compared to August. Specifically, daily revenue on exahash decreased by 2.6% month-on-month (MoM).
For the uninitiated, daily income per exahash refers to the amount of BTC miners earn per exahash – quintillion hashes – of computing power they contribute to the network every day.
The metric helps measure the profitability of mining operations by showing how much money miners make based on the collective power they devote to solving Bitcoin’s cryptographic challenges.
At the same time, while the average price of BTC remained stable, its network hashrate increased by 1.7%, which shows that more computing power is dedicated to protecting the network, making it more resistant to attacks. However, the increasing hashrate also reduces the profit margins of miners due to increased mining activity and competition.
Notably, Bitcoin mining companies based in North America increased their share of total BTC production, rising from 19.9% ​​in August to 22.2% in September. This report shows the increase in the efficiency of these companies due to the decrease in temperatures.
Among Bitcoin mining firms, Marathon Digital mined 705 BTC, followed by CleanSpark, which mined 403 BTC. Marathon also leads the industry with the highest hashrate of 36.9 exahashes per second (EH/s) as of September 30, 2024. Riot Platforms follows closely behind at 28.2 EH/s.
While Chinese mining pools still control the majority of BTC hashrate, US mining pools are catching up fast. Since September 23, China and the US together controlled 95% of all Bitcoin hashrates, which raises serious concerns about the network’s fragmentation narrative.
October Expects to Be a Tough Month
In the report, Jefferies stated that October could be a strong month for the BTC mining sector. The report reads:
October is currently poised to be a tough month with BTC prices only up about 5%, while the network is accelerating +11% more than offsetting that growth.
In April 2024, Bitcoin experienced its fourth halving which effectively cut mining rewards in half, from 6.250 BTC to 3.125 BTC. According to analysts, half expected resulting in a loss of annual revenue for businesses worth more than $10 billion.
The report concludes that regardless of who wins the upcoming US presidential election in November, there is a good chance of seeing “more pro-industry policies.”
In contrast, another US-based investment firm is Bernstein opies that the victory of the Republican candidate Donald Trump may propel the price of BTC to an all-time high (ATH). At the same time, the market needs a clear statement from Democratic candidate Kamala Harris. BTC is trading at $65,073 at press time, up 4.0% in the last 24 hours.
Featured image from Unsplash.com, Charts from Blockchain.com and TradingView.com
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