- The Crunch: Median mining costs ($44/PH/s) have overtaken revenue ($35/PH/s), forcing miners to operate at a loss.
- The Pivot: Q4 is on track to be the sector’s largest debt-raising quarter (~$5B) as equity markets dry up.
- The Warning: Machine payback periods now exceed 1,000 days—longer than the time remaining until the next Halving.
The U.S. Bitcoin mining sector has entered a critical “survivorship phase,” with November data confirming a structural inversion in mining economics. For the first time in this cycle, the median cost to produce hashrate has significantly exceeded the revenue it generates, forcing public miners to pivot from aggressive expansion to defensive liquidity management.
Analysts Reginald Smith and Charles Pearce noted that the daily block reward gross profit fell 26% in October. The network’s average hashrate slipped 1% to 1,074 EH/s after reaching an all-time high the previous month.
The analysts stated that miners generated an average of $41,400 per EH/s in daily block reward revenue during November, representing a 14% monthly decline and 20% lower than the same period the previous year. The combined market value of fourteen U.S.-led miners tracked by the bank decreased by 16% to $59 billion over the same period. However, Cipher Mining recorded a 9% increase, driven by its recent agreement with Fluidstack.
Related: Coinshares: Bitcoin All-In Mining Cost Reached $137K for Listed Miners in Q4 ’24
Rising Hashcosts Push Operators Toward Break-Even Levels
Data from TheMinerMag’s Q3 review shows that the median total hashcost for major public miners stands near $44 per PH/s. That figure includes operating costs, corporate overhead, and financing, calculated by allocating expenses according to the mining segment’s revenue contribution.
With hashprice sliding to $35 per PH/s in November, many miners are operating at or below break-even. The report also indicates that machine payback periods now exceed 1,000 days, longer than the roughly 850 days remaining before the next halving. Analysts view cost-per-hash as the more precise indicator in the current downturn, as it captures difficulty adjustments and highlights the widening gap between median costs and achievable revenue.
Capital Decisions Shift as Liquidity Priorities Rise
Companies are responding by adjusting balance-sheet strategies. CleanSpark recently repaid its Bitcoin-backed credit line with Coinbase shortly after raising more than $1 billion in convertible debt, a move linked to the tightening margin environment.
Funding trends from Q3 reflect similar conditions. Public miners raised about $3.5 billion in debt, largely through near-zero coupon convertibles, and $1.4 billion in equity. Entering Q4, fundraising has shifted toward senior secured notes at roughly 7%, with Cipher and Terawulf together securing close to $5 billion. This places Q4 on track to become the sector’s largest debt-raising quarter on record.
Related: Bitcoin Miner Revenues Climb to $51.6 Million Daily, Still Below Record Highs
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