Older Bitcoin (BTC) mining rigs are finding it difficult to generate positive revenues during the ongoing crypto market decline.

75% drop in Bitcoin mining profitability

The profitability of many Application Specific Integrated Circuit (ASIC) machines has dropped into the negative zone after Bitcoin’s fall below $24,000 this June 13, data fetched by F2Pool shows. Those machines include Antminer S11 and AvalonMiner 921, which are now close to their “shutdown price.”

Notably, Bitmain’s Antminer S11 offers a maximum hash rate of 20.5 Terra-hash per second (TH/s)

The cost of running an Antiminer 211 is 0.13 kilowatts per hour (KW/h) based on the global average electricity cost. As a result, it would consume around $4.5 worth of power every day versus the roughly $2 income in the same period, according to data gathered by ASIC Miner Value.

The profitability of Antminer S11 as of June 13, 2022. Source: Bitmain

Similarly, the cost of running Canaan’s AvalonMiner 921 comes to be around $5 per day compared to its income of over $2 in the same period.

Overall, Bitcoin miners’ earnings have dropped from $0.412 per TH/s/day in October 2021 to $0.11 per TH/s/day in June 2022, according to the “Bitcoin Hashprice Index” — a 75% decline in eight months. 

Bitcoin Hashprice Index one-year chart. Source: Hashrate Index

The losses coincided with a sharp decline in the Bitcoin mining hash rate in the last seven days — from an all-time high of 239.15 exa-hash per second (EH/s) on June 6 to 189.72 EH/s on June 13, according to data from CoinWarz.

Bitcoin hashrate data in last 12 months. Source: CoinWarz

This suggests that miners are limiting their BTC production capacity by theoretically shutting down unprofitable mining rigs and may continue in the coming weeks if Bitcoin fails to recover above $25,000 and/or the mining difficulty adjusts. 

Bitcoin mining stocks suffer

On June 13, Bitcoin price hit its lowest levels since December 2020 following a brutal crypto market selloff.

BTC’s price reached as low as $23,707 (data from Coinbase) versus its November 2021’s peak of $69,000. The losses came due to the concerns about rising U.S. interest rates.

BTC/USD daily price chart. Source: TradingView

Bitcoin mining businesses, which remain at the forefront of minting and supplying new BTC tokens, have suffered the brunt of falling prices. For example, Canaan’s stock dropped by more than 90% after topping at $39.10 per share in March 2021.

Similarly, VanEck’s Digital Assets Mining ETF (DAM), which opened for business in early March 2022, had lost 63% of its value as of June 10, measured from its record high of $46.05. It looked poised to open June 13 lower, per Nasdaq’s pre-market data.

VanEck Digital Asset Mining ETF daily chart. Source: TradingView

New gen BTC mining rigs still in profit

On a brighter note, some mainstream mining machines still generate profits for miners, hinting their owners would be able to weather the bearish Bitcoin market.

That includes the newly-launched iPollo’s V1, which returns a daily income of around $62 against its $9 power consumption in the same period, and machines from the Antminer’s S-series, which generate daily revenues of $4.75–$18, despite Bitcoin’s below-$25,000 prices.

Nonetheless, some profitable machines are near their shutdown thresholds, including Antminer’s S17+ (73T). It could become unprofitable when BTC’s price drop to $22,000, according to data provided by Bitdeer.

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