Investing.com – The network's monthly average hashrate declined sequentially for the first time since December 2022, as the mining economy remains pressured by inefficient and older ASICs after the halving, according to a JPMorgan report.
Daily mining revenue is more than 50% below pre-halving levels, which is expected to moderate hashrate growth in the near term.
Despite these challenges, May was a positive month for US-listed mining stocks. The JPMorgan report highlights that the companies reported record first-quarter 2024 revenue and adjusted EBITDA, even excluding mark-to-market gains on HODL balances, and increased their share of the network's hashrate. The aggregate market capitalization of the 14 U.S.-listed miners tracked by JPMorgan rose 19% sequentially to $18.4 billion, led by a nearly 80% rally in shares of iris energy .
The average Bitcoin price in May was about $65,200, less than 1% lower than April, with the seven-day moving average exiting the month at around $68,400, up 8% from April's figure. According to JPMorgan calculations, Bitcoin's annualized volatility was 51% in May, in line with 54% the previous month.
The network hashrate, an indicator of industry competition, declined sequentially for the first time since December 2022, as inefficient and older operators left the network after the halving. The network's average hashrate was 599 EH/s in May, 26 EH/s (4%) lower than April and 50 EH/s lower than previous halving levels. The network's seven-day rolling average hashrate at the end of the month stood at 595 EH/s, down 5% from the end of April, although up 58% year over year. Mining difficulty also decreased by 4% since the end of April.
Bitcoin mining profitability remained at record lows in May. Bitcoin miners earned an average of $49,000 per EH/s in daily block reward revenue, the lowest level on record. For context, this metric peaked at $342,000 in November 2021, when the price of Bitcoin was $60,000 and the network hashrate was 161 EH/s. It was around $100,000 before the halving. Transaction fees fluctuated between 3% and 10% of the block reward in May, reaching over 100%, a modest increase from 2% to 3% in April.
Proven block reward (remaining) and four-year block reward revenue opportunity were $87.9 billion and $43.8 billion, respectively, as of May 31, both up 9% than April 30. The aggregate market capitalization of the 14 US-listed miners was 21% and 42% of the face value of the four-year and proven block reward opportunity, respectively, a modest sequential increase and above averages historic 16% and 33%, respectively.
The group of 14 US-listed Bitcoin miners tracked by JPMorgan had an aggregate market capitalization of $18.4 billion as of May 31, up 19% on the month. The best and worst performing stocks for the month were Iris Energy Ltd (NASDAQ 🙂, up 79% and Digital Mining Fortress Inc (NASDAQ 🙂, were down 11%, respectively.
