Hard winter for bitcoin extractors

This year has been a number of challenges for the bitcoin mining industry. Reducing the extraction bonus, increasing network hardness, and the introduction of Bitcoin ETF funds into the market have put a lot of pressure on the profitability of extractors.

Reduce the extraction reward in half

In April 1, the Bitcoin extraction reward was reduced to 1.2 bits per block, according to the Technical Technology News Service. This adjustment, which occurs once every four years, is aimed at controlling the new bitcoin production rate. This has had a negative impact on the income of extractors per transaction.

Increase the hardness of the extraction network

The hardness of the bitcoin network, which indicates the difficulty of extracting each block, has been increasing since the beginning of the year and has reached its highest level in early May. This increase in difficulty exacerbates the competition between extractors, and to maintain profitability, the need to invest in more powerful hardware and improve performance.

Attraction by Bitcoin ETF Funds

Earlier this year, the launch of the Bitcoin ETF Funds introduced a new option for investors to participate in the Bitcoin market without the need for direct extraction. This has led some investors to depart from the shares of bitcoin extractors and attract to ETF funds that follow the price of bitcoin directly.

The status of extractors

Despite a 5 % rise in Bitcoin prices this year, the value of large -scale bitcoin extractors in the US, such as Marathon Digital and Riot Platforms, has fallen by about 2 %, respectively. This indicates the negative impact of the factors mentioned on the profitability of these companies.

The future of the bitcoin mining industry

Analysts believe that Bitcoin extractors should seek efficiency, investing in more powerful hardware, and adopting innovative strategies to maintain their profitability in these new conditions. Overall, the bitcoin extraction industry is transition to a new period that requires adaptation to increasing competitive conditions and adopting more efficient approaches to maintain profitability.