The Bitcoin mining market is facing serious challenges, especially the sharp rise in hashrate against a backdrop of declining prices.
Current State of Bitcoin Mining Market
Bitcoin's hashrate reached a new record of ~1025 EH/s. According to Glassnode, the seven-day moving average peaked at 897.6 EH/s on April 6, while mining difficulty updated its ATH at 121.51 T on April 5.
Profitability Issues in Mining
Analysts are noting a troubling trend: the increase in hashrate is accompanied by a drop in Bitcoin prices. The price of Bitcoin fluctuated around $80,000, almost 30% lower than the January high. As noted by CoinDesk Senior Analyst James Van Straten, miners require high Bitcoin prices, full blocks, and high transaction fees to remain profitable. At the end of Q1, network fee share accounted for only 1.33% of miners' total revenue.
Impact of Tariffs on Mining Equipment Imports
The import tariffs announced by President Donald Trump may adversely affect U.S. Bitcoin miners. Most mining equipment is imported from Malaysia, Thailand, and Indonesia, with new duty rates potentially increasing prices significantly. Domestic equipment manufacturers may see prices jump by 5-10 times compared to 2021, further straining the market.
The Bitcoin mining market faces significant challenges as hashrate grows and prices decline. The introduction of new tariffs may exacerbate the situation, undermining profitability and sector development.
