Public Bitcoin miners gain hash rate dominance despite stock declines
Public Bitcoin (CRYPTO:BTC) mining companies are steadily increasing their dominance over the Bitcoin network's security, even as their stock prices continue to struggle.
According to JP Morgan's "September ’24 Bitcoin Mining Halftime Report," publicly listed U.S. miners saw their share of the network hash rate grow for the fifth consecutive month, reaching a record 26.7%.
The hash rate, which measures the computational power used to mine Bitcoin and secure the network, has been expanding as miners invest in more powerful machinery and electricity.
In August alone, the 14 publicly listed miners tracked by JP Morgan added another 12 exahashes per second (EH/s) to their mining fleets.
This growth was led by Canadian miner IREN, which added 5.5 EH/s, and Marathon Digital, the world’s largest corporate miner, which contributed an additional 3.7 EH/s.
Overall, the combined hash rate of these miners has increased by more than 50% since the beginning of the year, now totaling 175 EH/s, representing 26.7% of the entire Bitcoin network.
However, this increased hash rate has not necessarily translated to higher revenues.
IREN was the only public miner in August to report an increase in the number of BTC mined compared to the previous month.
JP Morgan analysts noted that the number of bitcoins mined per exahash of operating capacity has decreased significantly this year, mainly due to the Bitcoin halving event in April, which cut the block reward from 6.25 BTC to 3.125 BTC.
As Bitcoin's hash rate hits new highs and its price trends lower, miner profitability is being squeezed.
This has led to declines in stock values for many public miners, with CleanSpark (CLSK) suffering a 12% drop.
The Valkyrie Bitcoin Miners ETF (WGMI), a diversified index of the mining industry, is down 2% year-to-date, while Bitcoin itself has risen 30%.
The aggregate market cap of the 14 U.S.-listed Bitcoin miners tracked by JP Morgan declined 3% since the end of August, trading at their lowest level since May 2024.
Despite the challenges, public miners continue to expand their share of the Bitcoin network, underscoring their growing role in securing the blockchain.
At the time of reporting, the Bitcoin (BTC) price was $57,787.08.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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