Bitcoin mining businesses generated their highest-ever monthly revenue in March, raking in over $2 billion in block rewards and transaction fees.
This shatters the previous record of $1.74 billion set back in May 2021.
JUST IN: #Bitcoin Miners hit a record $2 billion in monthly revenue, highest ever.
Halving coming in hot in 2 weeks 🙌
— Bitcoin Magazine (@BitcoinMagazine) April 2, 2024
Of the $2 billion earned last month, around $85 million came from transaction fees, while $1.93 billion was from the block subsidy. (Miners receive compensation both for validating transactions and minting new bitcoins.)
The block subsidy, paid out for each block mined, is currently 6.25 bitcoins. But it will drop to 3.125 bitcoins after the upcoming halving event in April. This will cut miner revenue from new bitcoin creation in half unless there is a significant price rise.
Higher network activity and increasing bitcoin prices both contributed to miners’ bumper revenues in March. The upcoming halving created urgency for miners to maximize earnings before profits are squeezed.
The leading US mining pool, Foundry, captured 29.4% of all blocks mined in March. Chinese pool AntPool took second place with 22.4% of blocks. The two captured over half the monthly Bitcoin supply.
While miners enjoyed their profit bonanza last month, exchange-traded funds purchasing bitcoins on the open market accumulated even more. ETFs bought roughly 66,000 bitcoins in March, while miners only produced around 25,500.
This widening supply-demand imbalance and halving-related scarcity could spur greater competition to secure Bitcoin. The resulting difficulty increases may start pricing out less efficient miners, spurring industry consolidation.
With the halving cutting rewards in half in a matter of weeks, miners face an increasingly harsh environment if Bitcoin’s price fails to compensate for the drop in issuance. But if history repeats, a strong bitcoin bull run could still be on the horizon, softening the revenue blow of reduced block subsidies.