The cryptocurrency mining industry has faced significant challenges, especially for miners using the SHA-256 algorithm to mine Bitcoin (BTC) and Bitcoin Cash (BCH). The prolonged bear market in 2018 led to reduced revenues and forced many mining operations to shut down. However, recent data indicates a potential turnaround, with gross mining margins increasing to 39% and mining hash rates for both networks showing signs of recovery.
Market Recovery Indicators: Rising Gross Mining Margins
Cryptocurrency mining is highly competitive, and recent months have been particularly tough for SHA-256 miners. Key observations include:
- Hash Rate Decline:
- August 2018: Combined BTC/BCH hash rate averaged ~65 EH/s.
- December 2018: Dropped to ~32 EH/s (a 50% decline).
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Current: Rebounded to ~45 EH/s.
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Revenue vs. Profit:
- February 2019 marked a 19-month low in miner revenue, with a 10% overall loss.
- Despite revenue declines, gross margins improved by 39%.
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Key Takeaways:
- Smaller mining farms were forced to exit due to unsustainable losses.
- Current 39% gross margins, though below early 2018’s peak of 94%, signal recovery from the 32% low.
Half of Bitcoin Cash Miners Are Still Mining Bitcoin
Blockchain.com data reveals:
| Network | Major Miners | Unknown Miners | Hash Rate (Mar 6, 2019) |
|---|---|---|---|
| Bitcoin (BTC) | 14 | 23% | 40.45 EH/s |
| Bitcoin Cash (BCH) | 13 | 10% | 1.4 EH/s |
Notably:
– The top 6 BCH mining operators also dominate BTC mining.
– Stable profitability and slight price increases have balanced hash power distribution between the two networks.
Next-Gen Mining Hardware Boosts ROI for Miners
Diar’s analysis highlights:
– Newer miners like Bitmain’s Antminer S15 (84% higher ROI than S9) are sold out until April 2019.
– Lower hardware costs encourage upgrades, driving hash rate growth.
Top 5 Profitable SHA-256 Miners (March 2019):
| Miner Model | Daily Profit Range |
|---|---|
| Ebang Ebit E11++ | $0.25–$1 |
| Bitmain Antminer S15 (28Th) | $0.25–$1 |
| Innosilicon Terminator 43T | $0.25–$1 |
| Asicminer Nanos 44Th | $0.25–$1 |
| 8 Nano Pro | $0.25–$1 |
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Key Insight: While daily profits remain modest, miners anticipate higher crypto prices to offset the 80–90% drop from 2017 peaks.
FAQs
1. Why did Bitcoin/BCH mining margins improve despite lower revenue?
Efficiency gains from exiting smaller miners and upgraded hardware reduced operational costs, boosting gross margins.
2. How does hash rate distribution affect BTC and BCH?
Shared mining operators balance hash power based on profitability, stabilizing both networks.
3. What’s the ROI difference between Antminer S9 and S15?
The S15 delivers an 84% higher return on investment compared to its predecessor.
4. Will mining profitability continue to rise?
Dependent on crypto price recovery; current margins suggest cautious optimism.
5. Why are unknown miners more prevalent in BTC?
Decentralized mining pools and privacy-focused operations contribute to higher “unknown” shares.
Conclusion
The 39% gross margin rebound offers a lifeline to miners after a brutal 2018. With half of BCH miners still supporting BTC and next-gen hardware improving ROI, the ecosystem shows resilience. However, sustained recovery hinges on broader market trends.
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