Bitcoin Price Hovers Around $58,000 as Mining Profitability Hits Record Low

The world’s largest cryptocurrency, Bitcoin, is currently trading at around $58,000, showing little movement in recent days. Despite being up over 100% from last year, the digital currency has faced some challenges in the mining sector.

According to CoinDesk, JPMorgan reported that Bitcoin mining became less profitable than ever before in early August. Mining is the process of using powerful computers to solve complex math problems, which helps keep the Bitcoin network secure and creates new bitcoins.

The bank’s analysts found that as more miners joined the network, it became harder for individual miners to earn money. This is because the total computing power used for mining, called the hashrate, went up. When the hashrate increases, miners need to work harder to earn the same amount of Bitcoin.

Interestingly, U.S.-based Bitcoin miners now control about 26% of the total mining power. This is the highest share ever recorded for American miners. However, these companies have seen their stock prices drop by about 18% since the end of July.

The current situation has led to mixed feelings in the crypto world. On one hand, the high hashrate shows that the Bitcoin network is very secure. On the other hand, it’s becoming harder for miners to make money, which could cause problems in the future if some miners decide to quit.

Bitcoin Is Better Off Year-on-Year

Despite these challenges, Bitcoin’s price remains strong compared to last year. It’s up about 35% since the start of 2024 and has more than doubled in value over the past 12 months.

However, some experts think that big investors, like banks and investment firms, might not be very interested in buying Bitcoin at its current price. They’re looking at something called the “stablecoin minting ratio,” which shows how much new money is coming into the crypto market.

This ratio has gone down recently, suggesting that big investors might be waiting for lower prices before buying more Bitcoin.