Bitcoin Mining Profitability Increased by Almost 20% in May, Jefferies Says
Bitcoin mining profitability experienced a significant surge in May, increasing by 18.2%, according to a recent research report from investment bank Jefferies. This rise is attributed to a 20% increase in Bitcoin’s price and a modest 3.5% growth in the network’s hashrate. The report highlights the correlation between Bitcoin’s price rally and the recent surge in gold prices, suggesting that investors are seeking inflation-protected assets in anticipation of rising fiscal deficits globally.
Hashrate, a key indicator of the total computational power used in Bitcoin mining, serves as a proxy for industry competition and mining difficulty. The increased hashrate reflects a more competitive mining landscape. The report further details the performance of publicly listed U.S. mining companies, revealing a substantial increase in Bitcoin mined in May compared to April. Specifically, these companies mined 3,754 Bitcoin in May, a notable increase from the 3,278 mined in April.
North American miners demonstrated a strengthened market position, accounting for 26.3% of the total network hashrate in May, up from 24.1% in April. This reflects the growing influence of North American mining operations within the broader Bitcoin network. Among the publicly listed companies, Marathon Digital Holdings (MARA) emerged as the leading miner, producing 950 Bitcoin in May—a remarkable 35% month-on-month increase. CleanSpark (CLSK) followed closely, mining 694 Bitcoin during the same period. In terms of installed hashrate, MARA maintained its lead with a substantial 58.3 exahashes per second (EH/s), while CleanSpark secured the second position with 45.6 EH/s.
Despite the positive performance, Jefferies revised its price target for MARA stock downwards from $18 to $16, while maintaining a “hold” rating. This suggests a cautious outlook on the stock’s future performance, even amidst the favorable mining conditions. The report underscores the ongoing importance of monitoring both Bitcoin’s price and the network’s hashrate to accurately gauge the profitability and competitive landscape of the Bitcoin mining industry. The strong performance of North American miners further highlights their increasing role in the global Bitcoin ecosystem.
