Bitcoin Mining Plummets to Post-Halving Lows Amid Weather Disruptions and Falling Prices
Weather disruptions and declining prices drive Bitcoin mining to post-halving lows, affecting output, revenue, and miner profitability.
Bitcoin's challenges persist as recent data indicates a significant decline in mining activity since the last halving. Market experts attribute this to power shortages from weather disruptions in the U.S., forcing several mining companies to reduce operations.
Hashrate Drops, Revenues Decline as Miners Face Post-Halving Challenges
CryptoQuant reports a 12% decrease in BTC hashrate, marking its lowest point in nearly five years. The overall hashrate reached its lowest since last September.
Since reaching an all-time high of $126,000 last year, Bitcoin's value has been declining, with a corresponding drop in its hashrate. This has left miners vulnerable, and power outages have accelerated the decline in mining activity.
Last week, daily income fell from $45 million to a yearly low of $28 million within two days. Although revenue partially recovered to $34 million by January 26, it remains below pre-storm levels.
Image Source: CryptoQuant
Production figures highlight the widespread impact:
- Major publicly traded miners reduced output from 77 BTC per day to 28 BTC.
- Other mining firms saw production drop from 403 BTC to 209 BTC daily.
- Network-wide output decline is the steepest since mid-2024.
- Both large listed companies and smaller private operators were affected.
Over a 30-day period, this contraction is the most severe since the last Bitcoin halving. Public miners lost up to 48 BTC, while other miners collectively lost around 215 BTC, indicating widespread stress.
CryptoQuant Data Reveals Miner Struggles Despite Difficulty Reductions
CryptoQuant's Miner Profit/Loss Sustainability Index fell to 21, its lowest since November 2024, indicating miners earn too little at current prices and difficulty levels. Recent difficulty reductions provided only slight relief.
Although lower difficulty helped reduce costs, it couldn't offset network issues and weather-related downtimes. The concentration of large mining operations in the U.S. increased vulnerability to regional power disruptions, a risk noted in earlier research. Extreme weather is becoming a key factor in mining stability.
At the time of writing, Bitcoin trades at $77,364 after a 7.89% intraday drop. During this period, Bitcoin's performance has lagged behind most major digital assets.
Currently, market sentiment remains bearish with extreme fear readings. Until prices stabilize and energy supplies normalize, miners are likely to remain under pressure.