Bitcoin miners are experiencing some of the tightest profit margins in recent memory as the cryptocurrency’s price slipped below the critical $62,000 level. The daily return per terahash of mining power has fallen sharply, reflecting mounting pressure on miners' profit margins and driving concern over increased sell-offs from the mining sector.
The estimated daily revenue for 1 TH/s dropped to an all-time low near $0.28, down significantly from $0.39 just one month earlier. This decline translates into reduced gross profits for popular mining hardware, such as the Antminer S21 XP Hydro, whose monthly earnings have shrunk from $192 to $137 at typical electricity costs. This squeeze on profitability coincides with a growing appetite for AI computing infrastructure, prompting miners to reassess their strategies amid the uncertain crypto market environment.
Miners and mining pools control over $110 billion worth of Bitcoin, a substantial portion of the circulating supply. Recent on-chain data reveal that Bitcoin reserves held by miners and pools have been decreasing steadily since early May, signaling increased liquidations. The motivation behind these sell-offs remains unclear but likely includes funding operational costs, paying down debts, or reinvesting in AI-related computing facilities, a sector viewed by some as more stable than traditional Bitcoin mining.
The concentration of mining power is also rising. Three major pools—Foundry USA, AntPool, and F2Pool—now command nearly 60% of the Bitcoin network’s hash rate, up from 44% a year ago. This consolidation intensifies concerns about network centralization and the influence these entities hold over the Bitcoin ecosystem.
Analysts highlight that the primary limitation for expanding AI data centers is access to affordable electricity rather than chip availability. This bottleneck has led some mining operators to repurpose their energy resources from cryptocurrency mining to AI computing, reflecting a shift in priorities driven by market conditions and profitability considerations.
On the cost front, estimates of Bitcoin production costs vary widely. The average all-in cost, including depreciation, hovers around $62,650 per coin, with the break-even point for electricity alone closer to $50,120. However, some large-scale miners with access to efficient ASIC hardware and industrial energy agreements report substantially lower costs. For instance, American Bitcoin Corp reported operational expenditures near $36,200 per mined Bitcoin in the first quarter of 2026, illustrating the diverse economics within the industry. Certain miners may even tolerate short-term losses for strategic benefits like tax advantages.
Institutional Bitcoin flows on spot markets have far outpaced miner outputs, indicating that broader macroeconomic trends carry more weight in price formation than miner profits alone. Still, the shrinking profitability and rising AI infrastructure demand have added a new dimension to how mining operations approach their Bitcoin holdings in a volatile market.