The economics of Bitcoin mining continued to improve in December, with JPMorgan noting in a research report that the hash price (a measure of daily mining profitability) rose by 5% from the end of November.
Key Points
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The hash price reached a daily block reward income of $57,300 in the first two weeks of December, the highest level in seven months.
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The network hash rate grew by 6% this month, averaging 773 EH/s.
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The hash rate of U.S.-listed miners has grown nearly 94% year-to-date, accounting for 29% of the global network.
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Despite the market capitalization of miners growing by more than 50% after the election, it fell by 4% in December.
JPMorgan analysts Reginald Smith and Charles Pearce stated that although the rise in hash price has improved miners' income, it is still about 40% lower than pre-halving levels.
Improvement in Mining Economics
According to JPMorgan's report, the rise in hash price in December was mainly due to the increase in Bitcoin prices outpacing the growth of the network hash rate. The hash rate is a proxy indicator of industry competition and mining difficulty.
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Hash Price: In the first two weeks of December, miners' daily block reward income reached $57,300 per EH/s.
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Network Hash Rate: Grew by 6% this month, reaching 773 EH/s.
Performance of U.S.-Listed Miners
The combined hash rate of the 14 U.S.-listed miners tracked by JPMorgan has grown nearly 94% year-to-date, reaching 222 EH/s, now accounting for 29% of the global network.
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Market Capitalization: Despite the market capitalization growing by more than 50% after the election, it fell by 4% in December, reducing by $1.5 billion.
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Trading Valuation: The current trading valuation of U.S.-listed miners is about twice their four-year block reward opportunity.
Future Outlook
With the continued rise in Bitcoin prices and improvement in mining economics, the market remains optimistic about the prospects of Bitcoin mining. Although current profitability levels are still below historical highs, the improvement in miners' income may attract more investors to this field.