đ Editorâs Note:
Today weâre publishing our 2nd installment of Zoomed-in, a new onchain deep dive series from OurNetwork.
Each Zoomed-in issue is authored by one of the marquee contributors from our analyst community. It will feature a deep dive on a single project of their choosing, going deeper than a standard OurNetwork issue.
One inspiration for this series was The Playersâ Tribune, a sports publication allowing readers to hear directly from professional athletes in their own words. Our hope is that we can create a similar platform to enable the industryâs top onchain analysts to reach a larger audience.
You can sign up to be a contributor here or ping the Editorial Team (TG: @ofernau) to register your interest in authoring zoomed-in coverage. We are always interested in featuring independent analysts looking to make a name for themselves.Â
Okay letâs zoooooooom in.
EXCLUSIVE ONCHAIN COVERAGE:
Bitcoin Mining âď¸
Project Website | Analytics Resource
The network at a glance: Bitcoin remains the crypto ecosystem's largest Proof-of-Work blockchain, with billions invested across mining hardware, rackspace, & energy infrastructure. Though hashrate has increased more than 70% over the course of the past year, the impacts of the 2024 Halving now strain the growth of the industry. Despite pulling in $34M+ in daily revenue, a large segment of miners are operating near breakeven, and even the most efficient ASICs barely turn a profit at industrial electric rates. Transaction fees remain negligible at ~5% of total earnings, though some mining pools are now employing sophisticated strategies for maximizing their capture of the highest-bidding transactions. Still, a large-scale flush out of miners is yet to occur, with firms aggressively expanding their fleets in anticipation of rising BTC price and increased on-chain activity.
đ§ Featured Analyst: Parker Merritt
Parker Merritt is a Solutions Engineer and research contributor at Coin Metrics, specializing in topics such as Bitcoin mining and on-chain flows. In his free time, Parker contributes to content strategy at the Bitcoin Mining Museum, tinkers with home mining ASICs, and analyzes publicly-traded mining firms.
â Bitcoin Network Health đŤ
đ Mining revenue collapses to $1.37K/MW, the lowest levels since FTX's collapse
Bitcoin miningâs main health indicator is hashrate, a.k.a. the total compute power securing the network. After a massive 3-year uptrend, hashrate (30D MA) is faltering post-Halving, dipping 4% from the all-time-high of 625 EH/s. On May 6, Bitcoinâs biweekly difficulty adjustment kicked in, giving miners some breathing room by dropping the work required to find a block by 5.6%. Still, the next adjustment is set to tick upwards 1%, once again putting mining margins under increased pressure.
Hashprice (USD earnings per unit of hashrate) is a key measure of miner revenue. Due to improved ASIC efficiency & increased competition, hashprice generally trends lower over time, reaching a new low of $0.045 per TH/s in May. Short-term transaction fee spikes can boost hashpriceâ the Runes launch on the Halving block briefly sent hashprice to $0.19 per TH/s, with a record 75% of revenue coming from fees. Onchain activity has since slowed, with fees contributing 5% of revenue in the past week.
In aggregate, miner revenue remains elevated at $34M daily, higher than the sectorâs top-line income for most of 2022-2023. However, revenue should be measured relative to electric inputâ year-over-year, mining consumes approximately 1.6x more power. Adjusting for power usage, miner revenue per megawatt has reached its lowest level since FTXâs collapse, with $1.37K earned daily per MW. This scarcely outpaces the cost of consuming 1 MW at an ultra-low power rate of $0.04/kWh (around $960 daily).
⥠Zoomed-in: ASIC Economics đ§
đ Aging ASICs drop 80-90% from their peak prices, operating close to breakeven at industrial power rates
Power costs (quoted in $/kWh) are minersâ primary operating expense. Depending on an ASICâs daily USD revenue, the ârationalâ shutdown threshold for each machine can be directly measured. At current hashprice, Antminer S19s (making up ~25% of network hashrate) breakeven at $0.06/kWh, well below the average U.S. industrial rate of $0.078/kWh. For residential miners at an average rate of $0.16/kWh, even the S21â Bitmainâs latest modelâ is unaffordable to operate at a breakeven rate of $0.12/kWh.
The 2021 bull run triggered an influx of âretailâ miners, with individuals rushing into hosting services to capitalize on outsized profitability. ASIC demand was clearly reflected on secondary markets like Kaboomracks, where ask prices for Antminer S19 models (90-110 TH/s) reached as high as $100/TH. In 2022, however, retail miners exited the market en masse, with ASIC premiums collapsing by -80%. Post-Halving, capitulation continues, with most âvanillaâ S19s now trading in the $4-5/TH range.
⢠Zoomed-in: Mining Pools đââď¸
đ The top 2 mining pools control > 50% of the market, though smaller pools earn an edge on transaction fees
Given Bitcoin emits only ~144 blocks daily, mining pools help smooth sector revenues by sharing rewards across a large constituency of miners. In recent years, pool dominance has become quite centralizedâ Foundry now commands a 28% share, with AntPool close behind at 26%. Some small pools have emerged as a counterbalance (SpiderPool rose to the top 10 in under 3 months with 2% share), but lopsided pool dominance remains a glaring gap in Bitcoinâs defense against censorship & disruption.
Not all pools are built equalâ some are notably more effective at capturing high-paying transaction fees. ViaBTC was the lucky pool to claim the Halving block with 37.63 BTC in fees, but MARA Pool has gained a slight edge by facilitating ânon-standardâ transactions (i.e. extra-large Inscriptions) for an extra fee. Taking the weekly average fees per block in 2024, MARA ranked highest in 5 of 21 weeks so far, with F2Pool taking 2nd place with 3 weeks spent as the top pool by average fee earnings.