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Cryptocurrency miners saw a slight drop in the number of bitcoins (BTC-USD) mined in September versus August as a surge in network hashrate and difficulties cried for trouble for profit margins.
The so-called difficulty of mining is a closely watched metric in the crypto ecosystem. It measures how hard it is to mine a bitcoin (BTC USD) block based on the number of participants and the computing power (hashing power) used to mine and secure the blockchain. High difficulty (as a result of high hashing power), as is the case now, tends to reduce miners’ profitability. As such, it is currently difficult to sit at record highs of 31.36 trillion versus 30.97 trillion a month ago Data from Blockchain.com.
The Bitcoin (BTC-USD) network hash rate, which measures how much computing power is used to process transactions on the blockchain, is at an all-time high of nearly 255 exahashes per second, a step that has accelerated margin compression in Bitcoin highlights mining industry, according to blockchain.com data. That’s up from 225 EH/s the month before.
Despite a higher network hashrate and difficulties along with lower Bitcoin (BTC-USD) prices, miners’ earnings increased slightly in September, rising from $16.6 million at the start of the month to $22.4 million at the end of the month . according to blockchain.com data. That’s still down from $40.9 million in the year-ago period.
Overall, crypto miners’ bitcoin (BTC-USD) production fell by an average of 1.1%, while the hashrate rose by 10.6%, as shown in the table below. Some companies cited a shorter month as one of the main issues with lower BTC production.
Looking at miners individually, Marathon Digital (MARA), CleanSpark (CLSK) and Iris Energy (IREN) were the only ones producing more BTC than in the previous month. Note that the following miners are yet to report their September numbers: Hive Blockchain (HIVE), BitNile (NILE), Argo Blockchain (ARBK) and Greenidge Generation (GREE).
Additionally, most miners continued to sell their Bitcoin (BTC-USD) holdings as capital dried up amid rising electricity prices and profit margins shrank. Over the month, Bitfarms (BITF) sold 544 BTC, Riot (RIOT) sold 300 BTC, CleanSpark (CLSK) sold 380 BTC, and Core Scientific (CORZ) sold 1,576 BTC.
For Bitfarms (BITF) in particular, SA contributor Gary Bourgeault believes the 10% drop in the company’s BTC production “may have been an anomaly.”
“The key for BITF through the end of 2022 and early 2023 will be the CPI release,” he added. “As things improve, high-growth assets will attract more investment and BITF will benefit.”
Take a look at the chart here to see how miner stocks performed versus Bitcoin (BTC-USD) in September.
Earlier last week (Oct. 6), Grayscale launched a new entity to invest in bitcoin mining hardware amid price discounts.
| 2022 | ||||||
| company | ticker | Type | September | August | July | |
| Marathon digital | (MARA) | bitcoins mined | 360 | 184 | 72 | 205.3 |
| bit farms | (BITF) | bitcoins mined | 481 | 534 | 500 | 505.0 |
| Hash rate (EH/s) | 4.2 | 3.9 | 3.8 | 4.0 | ||
| Riot Blockchain | (REVOLT) | bitcoins mined | 355 | 374 | 318 | 349.0 |
| Hash rate (EH/s) | 5.6 | 4.8 | 4.2 | 4.9 | ||
| CleanSpark | (CLSK) | bitcoins mined | 448 | 395 | 384 | 409.0 |
| Hash rate (EH/s) | 4.2 | 3.4 | 2.9 | 3.5 | ||
| Hut 8 mining | (HUT) | bitcoins mined | 277 | 375 | 330 | 327.3 |
| Hash rate (EH/s) | 3.7 | 2.97 | 2.92 | 3.2 | ||
| scientific core | (KORZ) | bitcoins mined | 1213 | 1334 | 1221 | 1256.0 |
| Hash rate (EH/s) | 13 | 12.69 | 10.9 | 12.2 | ||
| Sphere 3D | (ANY) | bitcoins mined | 11.06 | 12.8 | 12.8 | 12.2 |
| Iris Energy | (IRISH) | bitcoins mined | 325 | 301 | 154 | 260.0 |
| Average bitcoins mined | 433.8 | 438.7 | 374.0 | 415.5 | ||
| Average hash rate | 6.14 | 5.55 | 4.94 | |||
