The mining rate has recovered substantially since July 2021.
Bitcoin miners have seen a jump in their overall income in the last few weeks amid a surge in revenue from block rewards. According to Glassnode, Bitcoin mining revenue jumped above the $40 million/day level in October, which is up by +275% since the pre-halving period of $14M to $18M/day.
Since the halving event in 2020, the overall Bitcoin mining revenue has increased sharply. One of the major reasons behind that is BTC’s significant price rally since the halving event. Bitcoin is up by more than 500% since May 2020.
After China’s crypto mining ban, the overall hash rate dropped by more than 50% within a few days. However, the mining rate saw a strong recovery in August and September 2021. Now, the mining rate is near its highest level on record.
“Remember, Bitcoin miners have CAPEX (hardware, facilities, logistics) and OPEX (power, personnel, maintenance, etc) costs that are denominated in fiat currencies. Comparing the current aggregate mining income of $40M per day to revenues observed around the 2020 halving event, we can see that miner revenues are up 275% from the pre-halving period of $14M to $18M/day and +630% compared to the post-halving period of $6M to $8M/day,” Glassnode highlighted.
BTC mining revenues and hash rate are key indicators of the overall health of the Bitcoin network. In addition to these two, the overall Bitcoin entity-adjusted transaction volume spiked in the last few days. Bitcoin’s mining activity and its strong network played an important role in the recent bullish sentiment in the world’s most valuable digital currency.
“The 2018-19 mining recovery took a total of 164-days to completely reverse the bearish difficulty ribbon signal. The current market has been in recovery for 120-days and is likely to complete the flip after the next upwards difficulty adjustment. Despite dramatic shifts in the mining market, multiple deep price corrections and a halving event in May 2020, the Bitcoin block reward value continues to rise, creating incentives for the market to adapt, innovate and recover. Quite incredible really,” the report mentioned.