Bitcoin mining showed strong growth in 2024 despite halving: report

2024 saw Bitcoin mining achieve notable achievements as per the recent analysis by H.C. Wainwright’s analysts Mike Colonnese and Dylan Scales.

Bitcoin (BTC) experienced a remarkable 121% increase compared to last year, ending the year at approximately $93,390. It outperformed all other asset classes. The primary factors contributing to this surge were the introduction of U.S. spot Bitcoin ETFs, growing institutional interest, and the re-election of President Donald Trump who is supportive of Bitcoin, as suggested in an analyst’s report sent to crypto.news.

By December 31st, the hashing power of the Bitcoin network reached an impressive 796 exahashes per second (EH/s), representing a substantial 59% rise compared to 2023 figures. The majority of this growth can be attributed to public miners, who significantly expanded their operational capacity by approximately 100%, reaching 235.8 EH/s. As a result, public miners now contribute around 30% of the total network hashrate, an increase from their 22% share in the preceding year.

As an analyst, I observed a significant decrease in Bitcoin production among public miners following the April halving event in 2024. The reduction in block rewards led to a 32% drop in BTC production compared to the previous year, with public miners collectively producing 48,333 BTC in 2024 as opposed to 71,447 BTC in 2023. Interestingly, despite the decrease in production, BTC reserves on public miners’ balance sheets saw a substantial increase of 128%, reaching a total of 89,599 BTC by year-end.

Improved hash rate and mining capacity

In December, the operational hash rate of public miners grew by approximately 8.6%, resulting in the extraction of around 3,929 Bitcoins. This represents a 6.6% increase compared to the previous month, November. Conversely, transaction fees, which constitute a smaller share of miner income, decreased by 8.5% from one month to the next and comprised only 2.7% of the total block rewards.

The trends for the week ending January 12, 2025, highlighted some difficulties. The value of Bitcoin decreased by 4.1% to $94,759 due to the U.S. Department of Justice’s decision to auction off seized Silk Road BTC. Shares in mining companies fell by 7.7%, and the network hash rate declined by 4.4% to 777 EH/s.

The latest developments underscore the tenacity of Bitcoin miners in the face of increasing network complexity and economic stressors, paving the way for another thrilling chapter in 2025.

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2025-01-15 00:42