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What’s Working for Bitcoin Miners: Industry Summary

Analyzing public bitcoin miners performance and strategies, overall network mining activity and revenues, and low network traffic numbers.

Bitcoin Magazine Pro and Ansel Lindner

May 25

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As the Bitcoin ecosystem continues to evolve, recent data sheds light on significant trends and shifts within the mining sector and network activity. This week, we delve into the performance of publicly traded Bitcoin miners, uncovering the impacts of their expansion plans versus Bitcoin reserves during periods of price consolidation. We also explore the latest mining activity data, highlighting the critical adjustments miners are making in response to the post-halving environment and market volatility. Finally, we examine the dynamics of network traffic, focusing on the transition from Inscriptions to Runes and its implications for speculative interest and transaction costs. These insights provide valuable context for understanding the current state of the Bitcoin network and inform strategic decisions for investors navigating this rapidly changing landscape.

Public Bitcoin Miner Performance

The average 30-day performance for bitcoin miner stocks is -2.3%, down from +6% last week, with spot bitcoin significantly out performing. There are several surprises in the data for this week with miners with large bitcoin reserves performing quite badly. For miners with more than 1,000 BTC held, they averaged -9% returns over the last 30 days. The top three gainers were all miners that don’t hold bitcoin.

Iris Energy (IREN) has surged in recent weeks, up 39% in the last 30 days. This is likely due to their quarterly investor update, where they showed their revenue beating forecasts by 5% and earnings per share by 10%. IREN also announced it achieved its hashrate goal of 10 EH/s ahead of schedule, and its 2024 expansion plans have increased from 20 EH/s to 30 EH/s.

Cleanspark (CLSK), RIOT, Cipher (CIFR) and HIVE all have significant bitcoin holdings and all were down by double digits over the last 30 days. This also shows no correlation to their operational efficiency either.

Investor Insight

Valuing Expansion Over Reserves During Consolidation: In periods of price consolidation, investors are increasingly valuing miners' expansion plans and the execution of those plans over their bitcoin reserves. As the market dynamics shift again, it will be crucial to monitor whether the importance of bitcoin reserves increases during price breakouts, potentially reversing this trend and favoring companies with larger holdings...

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