Entering 2024, the Bitcoin mining industry is undergoing a survival pressure test. Against the backdrop of soaring network difficulty, most miners have experienced a significant decrease in Bitcoin output in January.
With mining difficulty soaring, where do miners go from here?
In January, Bitcoin mining difficulty hovered around the historical peak of 110 T (trillion). Since the Bitcoin halving event on April 20, 2024, network difficulty has increased by 27.8%, which means that the computing power required to mine new blocks has significantly increased, directly driving up miners' operating costs. In such an environment, those miners with slow hash power upgrades, poor energy efficiency management, and limited financing capabilities will inevitably be hit hardest. For example, Hut 8's monthly output decreased by 27%, with only 65 BTC mined in January. Mara and Bitfarms also saw declines of 12.5% and 4.7% respectively, indicating that even well-known miners in the industry cannot escape the difficulties under intensified hash power competition. However, Riot Platforms has defied the trend, not only remaining unaffected by the surge in mining difficulty but also increasing its Bitcoin output.
Bitcoin Mining - Has the Industry Shuffle Already Begun?
From the recent changes in mining difficulty, it can be observed that the Bitcoin mining industry is gradually evolving into a pattern where the strong become stronger. Miners with capital, energy advantages, and forward-looking strategies will further expand, while the survival space for small and medium miners is being compressed. Although the mining difficulty slightly decreased to 108 T at the end of January, and the hash rate stabilized at 832 EH/s, the overall trend remains pessimistic. As the halving approaches, the dual pressure of declining output and rising costs will accelerate the industry's elimination race. In the future, the core issue of Bitcoin mining will no longer just be the 'hash power competition,' but rather the 'sustainability of profit models.' Those who can gain an advantage in the three dimensions of energy, hardware, and capital will be able to stand firm in the next round of market fluctuations.
The Matthew effect in mining is becoming increasingly apparent; the weak are being marginalized while the strong continue to expand. Will the decline of Hut 8, Mara, and Bitfarms become a microcosm of the entire industry? Is Riot Platforms just an example, or the beginning of a new round of industrial concentration?
