In April, Bitcoin miners with HPC focus, such as IREN, RIOT, WULF, and HUT, continued to struggle as reported by JPMorgan. Mining profitability fell while the network hashrate rose by 6%. However, despite challenges, the total market cap of tracked mining stocks rose by 12%, with Greenidge as a standout performer at 46%. Diversification into AI services is a strategy some miners are pursuing to reduce cryptocurrency dependence.
Bitcoin miners with a focus on high-performance computing (HPC) saw a tough month in April, according to a recent report from JPMorgan Chase. These companies, including IREN, RIOT, WULF, and HUT, underperformed relative to Bitcoin (BTC), continuing a trend that has persisted for three months now. Mining profitability hit a snag last month as the network’s hashrate saw a significant uptick of 6%.
JPMorgan noted that the monthly average hashrate rose to around 872 exahashes per second (EH/s), marking an increase of 56 EH/s month-on-month. This growth represents the second largest rise in the average network hashrate on record. Consequently, daily block reward revenues dipped 6% compared to March, highlighting a challenging environment for miners.
Despite the tough marketplace for Bitcoin miners, the overall market capitalisation of the 13 mining stocks tracked by JPMorgan increased by 12% in April. Still, that appears to have been overshadowed by the significant struggles faced by some firms in the sector. Notably, Greenidge (GREE) stood out with an impressive 46% gain during the month, contrasting sharply with its peers.
To adapt to these challenges, many Bitcoin miners are diversifying their operations, venturing into services catering to the booming artificial intelligence (AI) sector. This shift aims to reduce their heavy reliance on the volatility of cryptocurrency markets. Analysts Reginald Smith and Charles Pearce from JPMorgan highlighted this strategy, noting it as a way for miners to mitigate risks across their business models.
Overall, the landscape for Bitcoin miners continues to evolve amid fluctuating profitability and increasing competitive pressures as reflected by the rising hashrate. The findings underscore the challenges of mining in a dynamic market, marked by the interplay between technological advancements and economic circumstances.
