Emmanuel Ochayi
Bitcoin miners struck proverbial gold in March, raking in over $2 billion in block rewards and transaction fees, marking a milestone in the cryptocurrency’s history.
This figure eclipses the previous record set in May 2021, which stood at $1.74 billion.
Join our WhatsApp Channel“March was an exceptional month for Bitcoin miners, with revenues reaching unprecedented levels,” remarked a spokesperson from Bitcoin Magazine.
Of the $2 billion amassed in March, approximately $85 million stemmed from transaction fees, with the lion’s share of $1.93 billion originating from block subsidies. This revenue stream comes from miners validating transactions and generating new bitcoins.
“The surge in Bitcoin’s price coupled with heightened network activity fueled the earnings for miners,” explained industry experts.
The looming halving event, scheduled for April, spurred miners into action to capitalize on the current profitability before impending profit reductions.
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Foundry, the leading US mining pool, claimed 29.4% of all blocks mined in March, closely followed by the Chinese pool AntPool, securing 22.4% of blocks. Together, these entities accounted for over half of Bitcoin’s monthly supply.
However, amidst the mining boom, a supply deficit looms in the sector, driven by escalating demand from prominent financial institutions.
“Exchange-traded funds acquired approximately 66,000 Bitcoins in March, significantly outpacing the 25,000 newly minted by miners,” highlighted market analysts.
This widening gap between supply and demand, exacerbated by the forthcoming halving event, is poised to intensify competition among miners. Consequently, only the most capable mining operations are expected to survive, leading to further consolidation within the market.
“Miners face an uphill battle as the halving event approaches, threatening to dent profits unless Bitcoin’s price experiences a significant uptick,” cautioned industry insiders.
As the block subsidy, currently set at 6.25 bitcoins per block, is poised to halve to 3.125 bitcoins after the impending event, miners are bracing for potential profit downturns.
Moreover, the influx of global financial giants like Blackrock into Bitcoin ETFs has buoyed demand for the cryptocurrency, further boosting miners’ profits.
In light of these developments, the future of mining remains uncertain, with miners navigating through turbulent waters amidst shifting market dynamics and impending regulatory changes.
Emmanuel Ochayi is a journalist. He is a graduate of the University of Lagos, School of first choice and the nations pride. Emmanuel is keen on exploring writing angles in different areas, including Business, climate change, politics, Education, and others.
