Post-halving, unprofitable ASICs cause decline in Bitcoin hash rate as miners power down.

Bitcoin’s hash rate has experienced a decline following the fourth Bitcoin halving, as mining companies have started shutting down unprofitable mining rigs. According to data from Blockchain.com, the Bitcoin network’s hash rate dropped to a two-month low of 575 exahash per second (EH/s) on May 10, before slightly recovering to the current rate of 586 EH/s. James Butterfill, head of research at CoinShares, attributed the decrease to miners turning off unprofitable rigs. This temporary drop was predicted by a report from CoinShares on April 19, which also anticipates a surge in the hash rate next year. The report explains that the increased costs of Bitcoin mining due to the halving, along with rising electricity costs, are contributing factors to the temporary reduction. However, Nazar Khan, co-founder and chief operating officer of TeraWulf, believes that only smaller mining operations with less energy-efficient equipment will be at risk after the 2024 halving. TeraWulf, the world’s eighth-largest Bitcoin mining company, plans to expand its operations this year despite the halving of block rewards. The profitability of mining operations is heavily influenced by electricity costs, as older ASIC models like the S19 XP and M50S++ operate at a loss with electricity costs above $0.0 per kilowatt-hour, according to Hashrate Index.