Bitcoin mining companies achieved their highest monthly revenue ever in March, generating more than $2 billion in block rewards and transaction fees.
This breaks the previous record of $1.74 billion set in May 2021.
just in: #Bitcoin Miners generated a record $2 billion in monthly revenue, an all-time high.
The half is coming hot in two weeks 🙌
– Bitcoin Magazine (@BitcoinMagazine) April 2, 2024
Of the $2 billion earned last month, about $85 million came from transaction fees, while $1.93 billion came from blanket support. (Miners receive compensation for validating transactions and minting new bitcoins.)
The block support, paid for each block mined, is currently 6.25 BTC. But it will drop to 3,125 BTC after the next halving event in April. This will halve miners' revenue from creating new bitcoin unless there is a significant price rise.
Rising network activity and increasing Bitcoin prices contributed to an increase in miner revenues in March. The upcoming halving has created an urgent need for miners to maximize profits before profits shrink.
The leading US mining pool, Foundry, accounted for 29.4% of all blocks mined in March. The Chinese AntPool pool took second place with 22.4% of blocks. The two accounted for more than half of the monthly supply of Bitcoin.
While miners enjoyed their profit boom last month, more exchange-traded funds have accumulated buying bitcoins on the open market. ETFs bought nearly 66,000 bitcoins in March, while miners produced only about 25,500 coins.
This growing imbalance between supply and demand and the scarcity associated with the halving could lead to increased competition to secure Bitcoin. The resulting increase in difficulty may price out less efficient miners, stimulating industry consolidation.
With rewards being halved within weeks, miners face an increasingly harsh environment if Bitcoin's price fails to make up for the decline in issuance. But if history repeats, there could be a strong Bitcoin rally on the horizon, softening the revenue blow caused by reduced block support.
