Compass Mining has shared the latest updates in a Bitcoin Mining Industry Report for the month of July 2024, focused on key operational developments.
As noted in a blog post by Compass Mining, the Bitcoin price closed the month of July “at $64,619 increasing by 3.1% during the month, providing much needed relief for Bitcoin miners who have witnessed rewards drop by 50% at the recent halving.”
However, Japan’s recent currency appreciation “led to the unwinding of carry trades and a sell-off in risk assets, including Bitcoin, taking the price below $50,000, last week.”
Speculators had previously borrowed yen “at zero interest, converted it into stronger currencies like the dollar, and invested globally, which significantly devalued the yen.”
Following Japan‘s 0.25% interest rate hike, the yen “surged nearly 10% against the USD, causing Bitcoin’s yen-denominated price on Tokyo’s bitFlyer exchange to drop nearly 15%, outpacing its 11% decline on Western exchanges.”
Compass Mining noted that with the Bank of Japan raising rates, money flows “are reversing, and the Bitcoin price has seen strength in the last few days regaining $60,000.”
“Hashprice,” a term introduced by Luxor, represents “the expected daily value of 1 TH/s of hashing power.”
This metric measures a miner’s potential earnings “from a given amount of hashrate. While hashprice can be expressed in any currency or asset, it is typically displayed in USD or BTC (sats).”
When the markets, led by Japan, crashed last week, Compass Mining pointed out that “the daily rate of hashprice per PH/s dropped to an all-time-low of $35 for each PH/s on line.”
According to Compass Mining’s blog post, this would “make it challenging for even the most efficient miners with access to low cost energy the ability to mine with a margin sufficient to cover operating costs.”
As stated in the update, the global hash rate “maintained a range between 500 EH/s and 700 EH/s in July, reaching an all-time-high on July 23, 2024, actually climbing significantly above 800 EH/s.”
The mining difficulty, however, actually “dropped by an average of 3.1%. This did not provide relief for miners in terms of their production, during one of the warmest months of the year, where more curtailment was utilized by the Bitcoin miners.”
The next mining difficulty adjustment is “due to change in a little over 3 days time and is currently due to drop by 5.36%, making the opportunity to mine more bitcoin for those miners on the global network.”
Ethereum ETF
As widely reported, the Securities and Exchange Commission “approved the listing of multiple spot Ethereum exchange-traded funds (ETFs), on July 22, 2024, concluding an eight-month review process.”
These ETFs, based on Ethereum’s spot price, “began trading on the same date and marks a significant milestone, legitimizing Ethereum and offering institutional investors a new entry point into cryptocurrency markets, beyond Bitcoin.”