Ethereum (ETH) continued to cheer high dominance over other alts, and miners confirmed that too. Ether miners earned over $3B more than their BTC peers in 2021. However, the optimistic tale around Ether miners saw a massive hit this year.
Why the Revenue Plunge
First and foremost, the Ethereum community awaits the Merge upgrade. Meanwhile, the ‘merge’ will push ETH’s $19 billion mining sector to secure a new household. The move would change Ethereum’s consensus to proof-of-stake from proof-of-work.
Secondly, the ongoing market crash discourages many investors, including miners. ETH lost about 72% in value, meaning miner revenue would have witnessed a substantial blow. Glassnode, a blockchain analytics platform, revealed that miners’ returns declined to a disturbing low.
ETH miners’ revenue saw a 27% slump from April. Notable, the business brought revenue totaling $1.39 billion during April 2022. Moreover, Ether mining witnessed a Y/Y monthly fall in May, with the month seeing near $2.4B in generated revenue. That reflected a 57% dip.
Generally, some miners disconnected their mining rigs due to the anticipated merge and plunging Ethereum prices. The slump in Ethereum network difficulty confirmed this plunge.
The processing power endured over a 10% drop following mining proceeds value plunge because of ETH’s latest freefall prices. The YTD chart shows the miner’s activity slides to around 900 TH/s, following the highs beyond 1,000 TH/s in June.
Besides that, the ever-surging electricity cost globally worsened the situation. Power bills account for the highest portion of miners’ charges. And increased electricity prices translate to reduced net returns for them.
Naturally, declined ETH hash rate and other facets impacted the miner’s return margin. Such conditions saw them disconnecting their Graphics Processing Units (GPUs).
Tom’s Hardware data confirmed continued graphics card prices in June, losing another 14%.
Meanwhile, the crypto market presents impressive overnight surges following the latest turmoil. Ethereum has gained more than 10% over the past day to $1,164.04 during this publication. That came as Bitcoin jumped past the crucial $20K level. While publishing this content, BTC traded with a 6.17% 24hr gain at $20,364.
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