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Hitting the Power Switch Back On: At a Loss Bitcoin Miners Resume Operations

Older Bitcoin miners come back online as market conditions improve

Bitcoin miners have made a significant move by reactivating their older cryptocurrency mining machines. This resurgence has played a pivotal role in achieving a record-setting hash rate, coinciding with Bitcoin's surge to a new all-time high in early March. According to Nico Smid, the founder of Digital Mining Solutions, in the firm's first quarter Bitcoin mining review published on April 2, "Improved market conditions have encouraged miners who were previously unprofitable at lower hash price levels to come back online."

The hash price level of Bitcoin has closely followed the trajectory of its price change, which has witnessed a remarkable 56.8% increase in 2024, reaching $66,280 at the time of publication. This resurgence of older Bitcoin miners has contributed to a notable 14.7% surge in the Bitcoin hash rate since the beginning of the year. Smid highlighted this growth by stating: 

"This growth is equivalent to adding 375,000 Antminers S21 200 TH/s to the network."

 

 

The deployment of Bitmain S21s and other latest-generation mining equipment has also played a significant role in driving the growth of Bitcoin's hash rate over the first three months of the year. On March 11, Bitcoin's hash rate peaked at 631 exahashes per second (EH/s) on a 7-day moving average, just days after Bitcoin surpassed its previous all-time high price of $68,990.

Miner revenues hit all-time high as miners adopt "wait and see" approach before halving

Despite a steady decline in transaction fees since the beginning of March, miner revenues reached a new all-time high on March 10. Smid noted: 

"While this is beneficial for individuals seeking to send quick transactions, it presents a less favorable scenario for miners who have grown accustomed to high transaction fees over the past few months."

However, as older miners are being reactivated, the cost of application-specific integrated circuit (ASIC) machines has stabilized. Many Bitcoin miners are adopting a cautious approach and holding off on new investments as the halving event approaches. Smid, citing an ASIC Jungle survey, stated: 

"Miners seem to be adopting a 'wait and see' approach as the halving event approaches."

Scheduled for April 20, the Bitcoin halving event will reduce miner rewards from 6.25 BTC ($414,000) to 3.125 BTC ($212,000) at current prices. Despite this impending event, Bitcoin continued its upward trajectory and set a new all-time high of $73,738 on March 14, according to CoinGecko.