Bitcoin News Today: Bitcoin Miners Battle Hashrate Surge and Price Drop in Survival Struggle

Bitcoin miners face mounting pressure as a record network hashrate collides with declining Bitcoin prices, squeezing profitability and extending payback periods for hardware. The hashrate, a measure of computing power securing the network, hit 1.16 ZH/s in October while Bitcoin's price fell toward $81,000 in November, according to The Miner Mag. Hashprice-a metric tracking miner revenue per unit of computing power- plummeted below $35 per hash, undercutting the $45/PH/s median reported by public mining firms. This decline has pushed operators near breakeven levels, with rig payback periods stretching beyond 1,200 days amid rising financing costs.

The financial strain coincides with a surge in miner borrowing, including a wave of near-zero-coupon convertible bonds issued in the past quarter. While some companies pivot to high-performance computing (HPC) and AI services to offset Bitcoin income losses, these efforts remain insufficient to counteract the sharp revenue drop.

Bitcoin ETFs have mirrored the sector's volatility. BlackRock's iShares Bitcoin Trust (IBIT) recorded a record $523 million outflow on Nov. 18, extending a five-day streak of redemptions totaling $1.425 billion as Bitcoin fell below $90,000. However, institutional investors began to re-enter the market by late November, with ETFs logging $238 million in net inflows on Nov. 21, led by IBIT's $60.6 million rebound. Abu Dhabi's sovereign wealth funds tripled their IBIT holdings in Q3, signaling long-term confidence.

Analysts attribute the ETF rebound to macroeconomic shifts, including expectations of a Federal Reserve rate cut in December. Despite the recent outflows, BlackRock's IBIT retains a 69% share of total Bitcoin ETF trading volume and $157.4 billion in assets under management. Meanwhile, Grayscale and Fidelity's ETFs also saw inflows, suggesting a diversification of investor strategies.

JPMorgan analysts have bolstered the sector's outlook, upgrading Cipher Mining and CleanSpark to "overweight" and raising price targets for both firms. The firm cited $19 billion in contracted HPC revenue across 600 megawatts of critical IT capacity signed by miners since late September, signaling a strategic pivot from Bitcoin-only operations to hybrid HPC models. IREN, another miner, saw its price target lifted to $39 from $28, though JPMorgan maintained an "underweight" rating due to high valuations.

Bitcoin miner reserves have hit record lows as operators monetize Bitcoin holdings to cover operational costs. Over 30,000 BTC-worth $2.6 billion-have been liquidated since Nov. 21, reducing total reserves to 1.803 million BTC, the lowest level on record. The sell-off reflects deteriorating mining economics, with hashprice collapsing 50% to $34.49/PH/s, a level unseen even during the 2021 China mining ban.

While institutional investors and analysts remain cautiously optimistic, the sector's survival hinges on Bitcoin's ability to regain its price trajectory. JPMorgan projects that miners could convert 35% of their power capacity to HPC by late 2026, offering a potential lifeline. For now, the market's focus remains on macroeconomic signals and the pace of institutional adoption, as Bitcoin navigates a critical juncture between bearish pressures and strategic reinvention.