Bitcoin mining is currently undergoing the most complex structural adjustment since the protocol's inception. Despite Bitcoin's price remaining around $61,000 and the network hash rate approaching 1 ZH/s—near an all-time high—miner profitability continues to deteriorate. Indicators such as production costs, transaction fee revenue, hash rate expansion, and industry security budgets all show that the mining sector is operating close to the breakeven point, and the 2028 halving may further accelerate industry consolidation.
Current data reveals that the challenges facing the industry stem not only from the reduction in block subsidies due to halving but also from the incomplete transition to a fee-driven revenue structure. Meanwhile, an increasing number of mining companies are shifting from being mere Bitcoin producers to infrastructure operators, energy operators, and AI/HPC computing infrastructure providers. In this process, the focus of mining competition is gradually shifting from hash rate expansion to business model upgrades.
Profitability Under Persistent Pressure: Mining's Economic Model Enters a Revaluation Phase
The PoW difficulty/issuance model indicates that Bitcoin's current lower bound for production cost is approximately $46,744. Historically, whenever the price has fallen near this level, it often signaled the exit of marginal miners and corresponded with the formation of a cyclical bottom. However, what is more noteworthy now is that miner revenue and Bitcoin price have shown a historically unprecedented and sustained divergence.
Data shows that at a Bitcoin price of around $61,000, the theoretical daily revenue for all network miners should be approximately $78 million, but the actual figure is only about $33 million—a difference of roughly 136%. Meanwhile, while the network hash rate is nearing 1 ZH/s, transaction fee revenue remains persistently low, currently averaging only about $220,000 per day, far below the roughly $9.7 million implied by historical relationships. As halving continues to compress new issuance, Bitcoin mining faces increasing profitability pressure.
From Mining to Infrastructure: The 2028 Halving May Drive Industry Restructuring
In addition to declining revenue, cost pressures on mining companies are also rising. In 2025, total revenue for Bitcoin miners was approximately $17.2 billion, of which electricity costs alone accounted for about $12.3 billion, or 71.5% of total revenue; global mining hardware investment was approximately $4.5 billion. A comprehensive analysis estimates that the industry's overall breakeven price is currently around $65,000, meaning that relying solely on mining operations is difficult to sustain ideal profitability levels at the current price.
It is estimated that after the 2028 halving, Bitcoin's production cost lower bound will further rise to approximately $93,289, accelerating industry concentration towards a few large, well-capitalized mining companies with diversified revenue streams. Compared to traditional miners reliant on block rewards, institutionalized miners with access to low-cost electricity, AI/HPC compute hosting businesses, and stronger balance sheet capabilities may gain a stronger competitive advantage in the new cycle.
Overall, the Bitcoin mining industry is undergoing a profound transformation from a "mining business" to an "infrastructure business." As block subsidies continue to decline, relying solely on Bitcoin production can no longer support long-term profitability. The industry's future will increasingly depend on diversified revenue sources such as energy management and AI/HPC compute hosting. For investors, what is truly worth watching is not just the halving itself, but which mining companies can successfully complete their business model transformation and establish more resilient competitive advantages within the new industry landscape.
The views above are partly sourced from BIT on Target. Contact us to obtain the full BIT on Target report.
Disclaimer: Markets carry risks; investing requires caution. This article does not constitute investment advice. Trading digital assets can be highly risky and volatile. Investment decisions should be made after careful consideration of individual circumstances and consultation with financial professionals. BIT assumes no responsibility for any investment decisions based on the information provided herein.
