Bitcoin miners saw a surge in profits in November as Bitcoin prices rallied and transaction fees increased. Despite still being below pre-halving levels, the cryptocurrency mining sector experienced significant growth, with publicly listed miners witnessing a 52% jump in market cap, according to JPMorgan.
Analysts reported that Bitcoin miners were earning $52,000 daily per exahash (EH/s) in November, a 24% increase from October. This increase in profitability came as Bitcoin reached new heights and transaction fees spiked around the US presidential election on November 5. The surge in transaction fees provided miners with much-needed relief in terms of hashprice, a key measure of mining profitability.
The overall network hashrate, which represents the total computational power dedicated to mining, grew by 4% month-on-month to 731 EH/s. However, the growth in mining difficulty outpaced this increase, rising by 7% from October.
Publicly traded Bitcoin miners also benefitted from November’s rally, with the combined market capitalization of 14 miners tracked by JPMorgan reaching $36.2 billion, a 52% increase from the previous month. This increase in market capitalization highlighted the growing investor confidence in the sector amid renewed optimism about Bitcoin’s performance.
Bitcoin’s annualized volatility rose to 62% in November, compared to 42% in October, reflecting heightened market activity. Analysts attribute this increase to the cryptocurrency’s strong price movement during the month.
While the report paints an optimistic picture of Bitcoin mining’s near-term future, challenges still remain. Despite the revenue boost in November, profitability reportedly remains about 50% below pre-halving levels.
As Bitcoin continues to evolve, the interplay between hashrate growth, transaction fees, and market dynamics will remain crucial for miners navigating this volatile landscape. Stay tuned for more updates on the evolving world of Bitcoin mining.