Bitcoin (BTC) miners are making a fortune out of “extracting” the digital currency. According to CoinDesk, Bitcoin miners generated $354.4 million last a week alone, breaking the old 2017 record.
On Sunday, the digital currency flirted with $50,000 before plunging back to $48,632 on Monday. In return, Bitcoin miners highly profited from mining the crypto —especially with the Bitcoin shortage in cryptocurrency exchanges.
Ethan Vera, co-founder of Seattle-based mining company Luxor Technology told CoinDesk Thursday: “Despite decreasing block reward, mining revenue on a USD basis has trended upwards. This is encouraging for the long term prospects of Bitcoin’s security and continued investments over the next few halving.”
In January, Bitcoin plunged to $27,000. However, the largest digital currency regained its momentum and led a rally to $49,670 on February 13. The cryptocurrency’s price increase followed news about Tesla’s $1.5 billion investment in Bitcoin. Furthermore, MasterCard and Bank of New York both announced last week that they’ll be accepting BTC. Consequently, Bitcoin price surged to a new all-time high.
Lex Moskovski, a cryptocurrency researcher and a quant trader said: “Any institution, company, and individual that holds any of the ETF below or plain $TSLA holds Bitcoin as well. Tesla has pulled the ultimate trojan horse. Let’s welcome Warren Buffett and the Swiss National Bank. Holding TSLA? You are long $BTC.”
With the recent price surge, Bitcoin miners saw an opportunity to double their earnings. In recent months, major hedge funds and financial institutions linked the cryptocurrency’s high price to the shortage in exchanges. In May 2020, Bitcoin cut the amount of new Bitcoin mining in half. Hence, mining became an even larger investment and miners’ revenue decreased by 50% in a blink of an eye.
“Our miners are incredibly bullish on the future of mining. January and February 2021 have been record months for most of them, and they are taking all of their profits and reinvesting it back into their business to grow future hash rate.” Vera added.
How Bitcoin miners made $4 million in an hour
According to data from Glassnode, Bitcoin miners profited over $4 million in 60 minutes on February 12 — the highest mining revenue in the history of the cryptocurrency.
Bitcoin miners profit from the increased number of transactions on the network. Hence, with more transactions, comes accompanying fees paid to miners. The total revenue includes transaction fees and the block rewards that miners collect.
In conclusion, mining one Bitcoin costs $8000. Therefore, with the cryptocurrency trading at $48,544 as of this writing — Bitcoin miners are estimated to break more records from Bitcoin mining in the future.