Bitfarms' Crypto Mining Revenue Takes a Hit, Drops 42% After Bitcoin Halving
Summary:
Bitfarms saw a 42% drop in crypto mining revenue in May, the first month post-Bitcoin halving. Its Bitcoin production fell from 263 BTC in April to 156 BTC in May. Extreme weather conditions and post-halving economics contributed to the slump. The company's installed hash rate is currently at 9.5 EH/s. Despite a production dip, Bitfarms’ stock increased 2.92% on Nasdaq on June 3.
Bitfarms' crypto mining income experienced a drop of 42% in May, marking the first month following Bitcoin halving that started mid-April. Bitcoin production for Bitfarms dipped from 263 Bitcoin ($18.1 million) in April to a mere 156 Bitcoin ($10.7 million) in May. A June 3 announcement from Bitfarms reported this as the "initial whole month governed by post-halving economy". Similarly, Bitfarms' average Bitcoin earnings per computational unit descended by 45%, moving from 44 exahashes per second (EH/s) to 24 EH/s.
The Bitcoin halving event that occurred on April 20 angled the Bitcoin mining rewards from 6.25 BTC to 3.125 BTC, creating economical hurdles for miners. Bitfarms also ascribed the slump in Bitcoin production partly to "exceptionally low temperatures" at its Rio Cuarto facility stationed in Argentina. The unusually severe weather conditions, marking the site's worst in 44 years, led to a temporary cessation of Bitfarms' mining activities at Rio Cuarto for approximately eight days.
Despite the setbacks in Argentina, a 4.2% network difficulty fall from April assuaged the situation to some extent. Within the month, Bitfarms was successful in securing over 100 megawatts at its Yguazu location in Paraguay, coming into a power purchase contract with Paraguay’s state-owned Administración Nacional de Electricidad. This agreement is set to boost the site’s capacity to 200 megawatts possessing the potential to incorporate an additional 6 exahashes per second (EH/s) by 2025.
As it stands, Bitfarms’ installed hash rate is situated at 9.5 EH/s, theoretically placing it as fifth largest after Marathon Digital, Core Scientific, CleanSpark, and Riot Platforms, based on Hasrate Index data. Bitfarms also reported having another 16,200 Bitcoin miners on standby, anticipated to raise the company's hash rate to 12 EH/s when deployed. Besides Argentina, the company has mining operations up and running in the U.S. and Canada.
Furthermore, the firm recently dismissed a $950 million procurement proposal put forward by Riot Platforms. In spite of a 42% plummet in Bitcoin production, Bitfarms’s stock (BITF) experienced a 2.92% increase on the Nasdaq on June 3, as per Google Finance records. Even so, BITF remains down by 15.9% going into 2024, following a robust 2023 where the company’s shares skyrocketed by 588%.
Credit: Google Finance
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Published At
6/4/2024 2:25:18 AM
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