According to CryptoPotato, Bitcoin miners are experiencing the negative impacts of the recent halving, with industry revenues hitting their lowest since early 2023. This situation has led to tighter profit margins and raised concerns about the survival of certain industry firms during Bitcoin’s next halving epoch. It also brings into question the potential impact on Bitcoin’s market price.
Data from on-chain analytics platform CryptoQuant reveals a sharp drop in Bitcoin’s 'Puell Multiple' immediately after the halving between April 19 and April 20. The Puell Multiple is a ratio that compares the value of daily BTC issuance in USD terms to the 365-day moving average of the same metric. With the number of new BTC issued to miners dropping from 6.25 BTC per block to 3.125 BTC per block, the Puell multiple has seen a decline. According to Glassnode Academy, a high Puell multiple indicates high miner profitability, incentivizing miners to liquidate their coins. On the other hand, a low multiple forces less competitive miners to shut down their rigs, making the remaining miners more profitable and enabling them to sell fewer coins to cover their operations. As of April 28, the multiple was at 0.73, significantly below its 365-day simple-moving-average of 1.43.
CryptoQuant CEO Ki Young Ju stated on Twitter that miners now have two options: capitulation or waiting for a rise in Bitcoin price. He added that there are currently no signs of capitulation. CryptoQuant’s mining dashboard indicates that miner BTC flows to OTC desks and exchanges remain relatively low, suggesting that they are not eager to sell their BTC.
Despite the suppressed miner revenues, the day of the halving was unusually profitable for miners, generating $106 million in revenue compared to approximately $68 million on previous days. This temporary profit boost was largely due to the simultaneous launch of Runes, a new protocol standard for minting tokens on Bitcoin, developed by Ordinals creator Casey Rordamor. The rush to mint new tokens by Runes users drove Bitcoin network fees to over $100 per transaction, allowing miners to net several blocks with over 30 BTC in fee revenue. However, fees have since returned to normal levels, and miner revenue has dropped to $28.5 million per day.