Bitcoin Mining Profitability Declines for Third Consecutive Month in September, JPMorgan Reports

Bitcoin mining profitability continued its downward trend in September, marking the third consecutive month of declining daily mining revenue and gross profits. According to JPMorgan, this decline is partly driven by the rising hashrate, which indicates increased competition among miners, coupled with subdued transaction fees and lower profitability per exahash per second (EH/s).

Key Highlights:

• Hashrate Growth: The Bitcoin network's hashrate rose 2% from August, reaching 643 exahashes per second (EH/s). This increase signifies more competition in the mining industry as miners race to process transactions and earn rewards.

• Falling Gross Profit: The daily block reward gross profit for miners fell 6% month-over-month (m/m) to $16,100 per EH/s, marking the lowest level in recent records. This resulted in a gross margin of 38.4%, suggesting that mining remains less profitable.

• Revenue Decline: The average daily mining revenue per EH/s decreased by 6% compared to August, dropping to $42,100. This decrease in profitability is partly attributed to relatively low transaction fees, which contributed less than 5% of the total block reward.

• Market Capitalization of U.S.-Listed Miners: Despite the overall decline in profitability, the market capitalization of the 14 U.S.-listed miners tracked by JPMorgan rose 4% to $21 billion. Hut 8 outperformed with a 21% gain, while CleanSpark saw a 13% decline.

• Bitcoin’s Volatility: Bitcoin’s annualized volatility dropped to 44% in September, down from 62% in August, indicating less price fluctuation in the cryptocurrency’s market.

The ongoing decline in mining profitability highlights the growing challenges for miners, particularly as competition increases and transaction fees remain low.