Bitcoin mining margins hit record low as BTC tests $60K
Bitcoin mining margins fell to record lows as BTC struggled to hold the $60,000 floor, raising trader fears that miners could sell into weakness. The estimated daily return for 1 TH/s dropped to an all-time low of $0.28 (from $0.39 a month earlier), and related gross profit for an Antminer S21 XP Hydro fell to about $137 per month (from $192).
On-chain signals also turned negative: the 14-day average net position change in miner and mining pool addresses flipped negative in early May and stayed there. That suggests continued BTC outflows that can pressure price discovery, even if some activity could fund operations, reduce leverage, or reallocate capital toward AI data-center computing.
Competition for power is a key theme. With AI infrastructure demand rising, analysts note electricity access is the bottleneck for scaling data centers, prompting some miners to repurpose power. Large players remain influential—Foundry USA, AntPool, and F2Pool control 59% of hashrate, versus 44% for the top three pools in 2022.
Institutional spot flows appear to dominate the tape: the article argues spot inflows greatly exceed miner output, implying macro risk sentiment may matter more than mining margins alone. Still, Bitcoin mining margins at record lows can worsen downside during risk-off periods.
Notable figures/sources cited include Charles Edwards (Capriole Investments) and data from Luxor Hashrate Index, Glassnode, and LightningNewsX.
Bearish
This is categorized as bearish because the article links record-low Bitcoin mining margins with negative miner/mining-pool net position changes and weakening BTC price action near the $60K floor—an arrangement that historically can amplify downside if miners sell to cover costs or de-lever. It also points to persistent estimated revenue compression (e.g., $0.28 per 1 TH/day), which reduces miners’ willingness/ability to absorb volatility.
However, the piece also offers an offset: institutional spot flows are described as far larger than miner output, suggesting the broader market’s risk appetite could dominate. In the short term, the continued outflow signals can increase sell-side liquidity and raise the probability of breaking support. Over the longer term, if miners successfully reallocate power toward AI computing, some of the margin pressure may ease and stabilize sell pressure—though that transition is gradual and doesn’t immediately remove near-term liquidation risk.
A parallel to prior cycles: when miner revenues deteriorate and net position change turns negative, markets often see more reactive sell pressure during risk-off moves, even if the eventual narrative (e.g., structural demand or institutional flows) remains supportive. Netting both sides, the near-term trading implication is downside risk while BTC tests key support.