JPMorgan Analysts Publish New Report on Bitcoin: “For the Fourth Month in a Row…”

Bitcoin mining revenue and profit continued to decline for the fourth consecutive month in October, according to a recent research report by JPMorgan.

The report showed that daily Bitcoin (BTC) mining revenue and gross profit are experiencing a decline due to increased competition and network difficulty.

JPMorgan estimates that Bitcoin miners earn an average of $41,800 per exahash per second (EH/s) in daily block reward revenue, a 1% decrease from September. Hashrate, which measures the total computing power used to mine and process transactions on the Bitcoin network, serves as an indicator of both competition and mining difficulty. The report noted that as hashrate increases, the mining process becomes more competitive, affecting profitability.

The bank also noted that gross profit from daily block rewards fell 2% in October, reaching the lowest level seen in “recent records.”

Despite the decline in profitability, the report noted a significant increase in transaction fees toward the end of October. At one point, transaction fees accounted for 60% of the block reward, providing miners with temporary relief in hashprice, a measure of daily revenue for mining companies.

The report also detailed the significant increase in the Bitcoin network’s average hashrate, which hit a record high of 702 EH/s in October. This is a 9% increase compared to September and reflects the intensifying competition among miners. Analysts Reginald Smith and Charles Pearce noted that the seven-day moving average network hashrate at the end of the month was 748 EH/s, a significant 18% increase compared to the end of September and a 62% increase compared to the previous year.

In contrast to the decline in revenue and profitability, the combined market value of the 14 publicly traded Bitcoin mining companies tracked by JPMorgan rose 14% to $23.9 billion in October. The increase was led by firms expanding into high-performance computing (HPC), suggesting that diversification beyond traditional mining could provide resilience in volatile market conditions.

*This is not investment advice.