Stable Bitcoin Prices Benefit Miners, Mining Giants Expand Crypto Market Layout

Analysts from Bernstein emphasized the unexpected benefits that stable Bitcoin prices bring to cryptocurrency mining. Although Bitcoin's price currently shows no major fluctuations and hovers between $50,000 and $60,000, the situation has proven beneficial for mining operations, especially following the fourth Bitcoin halving on April 20.

The halving event cut Bitcoin mining rewards in half, and the market initially expected this would pressure the mining industry. However, the subsequent "steady" price action eased competitive pressures, allowing miners to remain profitable despite operating costs doubling.

This phenomenon has led to adjustments in mining dynamics, including a 10% drop in Bitcoin's computing power from a 7-day moving average of 638 EH/s to 579 EH/s, until the most recent difficulty adjustment.

Computing power refers to the income that cryptocurrency miners can expect from each 1 PH/s or 1 TH/s of hash rate.

The decrease in computing power also led to an extension in the average block time to about 10 minutes and 36 seconds, slightly above the Bitcoin protocol's target of 10 minutes. The mining difficulty, a measure to ensure a new block is produced every 10 minutes on average, dropped by 6% to 83.1 trillion hashes, marking the most peculiar decrease since the crypto winter of December 2022.

Bernstein analysts said, "The stability of Bitcoin prices actually benefits existing low-cost miners." "This allows them to consolidate market share and carry out aggressive capital expenditure and acquisition plans without endlessly increasing spending to maintain market position."

Among the top mining companies, CleanSpark and Riot Platforms are known for their optimal production costs and strong Bitcoin balances and cash positions. They have also expanded their business scopes, with Riot planning to increase the actual capacity of its new site in Corsicana to 31.5 EH/s.

CleanSpark has also acquired new sites in Mississippi and Wyoming to increase its 75-megawatt capacity.

Bernstein expects these leading miners to continue consolidating their market share through organic growth and acquisitions. Therefore, the report predicts that by 2025, CleanSpark and Riot will control about 6% of the network, up from the current 4.7%.