Despite news in recent months that cryptocurrency mining establishments have been shutting down, or ending contracts, profits earned from Bitcoin mining have begun to rise, blockchain research group Diar reports.
However, this comes after some of the worst months for Bitcoin mining to date. According to Diar, in February mining revenue fell to the lowest point for the last 19 months. Just $195 million worth of Bitcoin was minted, 10 percent less than in the previous month.
It was much the same for gross margins – the difference between revenue and cost of goods – too. As they saw a drop from 94 percent in January 2018, to 32 percent in January 2019. That said, there are signs the market is improving, as gross margins increased to 39 percent in February 2019.
It shold be noted that gross margins are all dicated by the value of cryptocurrencies being mined, the value of reward, and the cost of electricity. To remain competitive in mining it pays to use the latest and most powerful ASIC mining equipment.
More modern ASIC mining equipment is, by design, more power efficient and more powerful. As such, it’s able to deliver greater mining success with a lower overhead.
Indeed, this increase in margin is most likely a result of the increase in hash rate competition forcing older hardware to be taken offline, and the somewhat stable prices of cryptocurrencies over the last couple of months, allowing mining firms to streamline their operations.
There’s no knowing if this trend will continue of course, but mining is certainly showing signs of life.