Bitcoin’s average monthly hashrate continued its downward trend in June, dropping to 580 EH/s from 599 EH/s in May and 625 EH/s in April—a telling sign of the extent of capitulation among unprofitable operators in the two months following Bitcoin’s halving.
The ongoing decline of hashrate led to an increase of Bitcoin’s daily production benchmark, rising from 0.8 BTC/EH/s in May to 0.83 BTC/EH/s in June, according to data from TheMinerMag. This means if a company’s operating hashrate remained constant at 1 EH/s, it would have mined 24.84 BTC in June, which was 0.7% more than the 24.66 BTC it would have mined in May—despite June being one day shorter.
It is particularly interesting when comparing this benchmark with the bitcoin production of major public mining companies, who appear to be capitalizing on the overall decrease in network competition.
To date, Bitdeer, Bitfarms, CleanSpark, Cipher, Marathon, and Riot have released their June production figures. Four of these companies reported a significant month-over-month increase in proprietary Bitcoin production, as shown in the chart below. Although Marathon and Bitdeer experienced a drop in Bitcoin production, they increased their energized proprietary hashrate, with Marathon notably reaching the 30 EH/s mark.
If we ignore the fluctuation of monthly mining rewards and average network hashrate, Bitfarms, CleanSpark, Cipher and Riot alone have increased their realized hashrate by 4.18 EH/s in June. They racked up more mining machines at a time when smaller and unprofitable operators had to unplug machines due to bitcoin’s low hashprice levels.
As a result, the amount of hashrate unplugged from the network could be much bigger than the average hashrate decline—sufficient to counterbalance the hashrate growth of larger mining operations.
In other words, a hashrate consolidation is occurring behind the scenes as large-scale operators secure larger portions of mining rewards, utilizing the billions of dollars in cash raised through stock offerings to finance the expansion of their fleets and infrastructure.
With that being said, bitcoin’s mining difficulty is expected to ease by about 5% sometime on Friday due to the overall hashrate decline.
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