Contents
Network Overview
This has been a pretty turbulent week for Bitcoin, as the price greatly surged after the US election. This has fuelled an increase in network hash rate of more than 8%, with a corresponding difficulty increase. Mining revenue went down, but is expected to recover if prices continue to go up at this pace. Transaction fees came down from last week’s peak of $8, and are now quite low at less than $1. Mempool size also shows a reduction in network congestion.
Bitcoin Mining Bans Could Backfire, Increasing Global Emissions
Governments considering bans on Bitcoin mining in eco-friendly countries may unintentionally boost global carbon emissions, according to Exponential Science researchers. Their report warns that prohibiting mining in nations like Canada, which rely heavily on renewable energy sources, could drive operations to regions with less sustainable energy, worsening the environmental impact. For instance, banning mining in Canada alone could raise network emissions by 5.6%, adding 2.5 million tonnes of CO2 annually.
The study emphasizes that not all Bitcoin mining carries the same environmental cost, as energy sources vary greatly by country. This insight comes as Canada’s Manitoba province extends its moratorium on new crypto mining projects. Meanwhile, Russia continues to regulate its crypto mining sector, seeking to profit from the most recent Bitcoin boom.
Source: Cointelegraph.com
Galaxy Digital Eyes AI as Bitcoin Mining Profits Shrink
Galaxy Digital, led by Michael Novogratz, has signed a non-binding deal with a U.S.-based hyperscaler firm to transform its 800 MW of mining capacity into hosting high-performance computing (HPC) for AI. This pivot comes as Bitcoin’s recent halving and increasing mining difficulty continue to squeeze industry profits. Currently, 200 MW of Galaxy’s capacity is operational, with an additional 1.7 GW under study for potential permits.
This shift reflects a growing trend in the mining sector, as firms like Core Scientific and HIVE also diversify into AI computing. The rationale is straightforward: miners possess readily deployable power infrastructure, which is attractive to AI companies. Despite a 23% decline in Galaxy’s mining revenue, the company reported a narrower net loss and a 30% increase in operating revenue for Q3, prompting a 7% jump in its stock.
Source: coindesk.com
FERC Blocks Amazon’s AI Data Center Power Expansion Amid Grid Concerns
The Federal Energy Regulatory Commission (FERC) has rejected a proposal from Talen Energy to increase power supply to Amazon’s AI data centre in Pennsylvania. The requested upgrade would have boosted the centre’s capacity from 300MW to 480MW, potentially straining the regional grid. Despite PJM, the regional transmission organization, confirming its ability to handle the increased load, FERC raised concerns about grid reliability and potential cost hikes for other consumers.
Bitcoin miners have expressed unease over the growing energy demands of AI facilities. Researchers argue that AI’s ability to generate higher revenues per kilowatt-hour allows these centers to outbid miners, further pushing mining operations to less developed regions. As AI’s reliance on stable electricity intensifies, competition between the two sectors is expected to escalate.
Source: cryptopolitan.com
BitFuFu Reports Rising Costs and Expanding Operations Amid Bitcoin Halving Pressure
BitFuFu, Bitmain’s cloud mining arm, revealed a sharp increase in the breakeven price for mining Bitcoin, now at $59,452 per BTC. Despite this, the firm remains competitive, boasting an average electricity cost of $0.04 per kWh. In Q3 2024, BitFuFu expanded its mining capacity to 556MW and achieved a hashrate of 26.2 EH/s, securing its position in the cloud mining sector.
The halving event in 2024 has tightened margins, but BitFuFu’s diversified operations and scale have enabled it to post decent financial results, with $90.3M in revenue for Q3. The firm continues to attract cloud mining clients, despite BTC production shrinking by 40% year-on-year. BitFuFu also expanded internationally, acquiring a majority stake in an Ethiopian facility to boost its capacity.
Source: cryptopolitan.com
Bitcoin Mining Difficulty Surpasses 100T, Challenging Miners Amid Revenue Slump
Bitcoin’s mining difficulty has reached an all-time high of 101.65 trillion (T), marking a new high for the network. This surge in difficulty, combined with a seven-day moving average hashrate peak of 755 EH/s, showcase how much competition has increased in the Bitcoin mining sector. Smaller miners, who often lack the financial resources of their publicly traded counterparts, face increasing pressure to stay operational.
Meanwhile, major mining firms like Riot Platforms and MARA have ramped up production, with MARA mining 717 BTC in October. Despite operational gains, miners are grappling with declining revenues, which fell for the fourth consecutive month, according to a JPMorgan report. The report shows a 9% monthly increase in the network’s average hashrate to 702 EH/s. While large-scale operations can absorb some of the impact through advanced technologies and economies of scale, smaller miners are increasingly squeezed out.
Transaction fees provided some relief in October, occasionally accounting for up to 60% of block rewards. However, this revenue stream remains highly variable, adding another layer of uncertainty for miners. Daily block reward profits dropped to $41,800 per EH/s, tightening margins across the industry. This has prompted many miners to sell their Bitcoin holdings to cover operational costs, intensifying sell-side pressure on the market.
Publicly listed mining firms, including CleanSpark and TeraWulf, are responding to these challenges by scaling up their operations and optimizing costs. CleanSpark’s recent expansion added 5 EH/s, contributing to a total operational hash rate of 31.3 EH/s. Despite the efficiency improvements, the broader industry continues to face a profitability crunch, with mining firms reporting mixed financial results amidst the rising cost of maintaining competitive hashrates.
Source: coindesk.com
Source: financemagnates.com
Sangha Renewables Aims to Transform Renewable Energy Surpluses Into Bitcoin
Sangha Renewables, a Bitcoin mining startup, is making waves by partnering with renewable energy companies to turn their excess electricity into digital currency. The company has just inked a 19.9 MW deal with a major renewable energy provider in West Texas, aiming to prevent energy wastage. This pilot project, set to launch in 2025, is expected to mine approximately 900 Bitcoin over the next decade, generating an estimated $42 million in its first year. Sangha offers a simple pitch: it covers the operational costs, and energy companies need only provide surplus power.
This innovative approach addresses a critical issue for green energy producers: stranded energy. By converting unused electricity into Bitcoin, Sangha not only boosts revenue for energy firms but also creates a new financial model for the renewable sector. Co-founder Spencer Marr envisions a future where Bitcoin mining establishes a global electricity index, redefining how energy is valued and traded.
Source: coindesk.com
Deutsche Telekom and Bankhaus Metzler Pilot Bitcoin Mining to Stabilize Energy Grid
Deutsche Telekom has teamed up with Bankhaus Metzler to explore Bitcoin mining using surplus renewable energy in a groundbreaking pilot project. Hosted by Metis Solutions GmbH at Riva Engineering’s facilities in Germany, the initiative leverages photovoltaic-generated excess electricity that would otherwise go unused. By converting this surplus energy into Bitcoin, the project aims to stabilize grid supply during production peaks, aligning with successful implementations in countries like the U.S. and Finland.
The operation serves as a testbed for blockchain applications in energy management and financial services. Bankhaus Metzler, through its Digital Assets Office, focuses on blockchain innovations, while Telekom MMS operates the mining infrastructure. Both firms aim to gather critical data, exploring the potential for broader applications in grid stabilization and digital asset ecosystems.
Source: cryptoslate.com