Shares of most miners have been showing negative returns since the beginning of the year

What’s new? Shares of most mining companies have seen their value drop as much as 84% since the beginning of the year, despite bitcoin rising 113% over the same period. Among the 25 miners included in the Hashrate Index, only seven companies have brought investors profits since the beginning of the year. Shares of Bitdeer (BTDR) are up 167%, Cipher (CIFR) is up 33%, Hut 8 (HUT) is up 91%, Iris Energy (IREN) is up 72%, Northern Data (NB2) is up 58%, Core Scientific (CORZQ) is up 327%, and TeraWulf (WULF) is up 169%.

Hashrate Index data

What else is known? Meanwhile, Argo Blockchain (ARB) securities fell 84%, Sphere 3D (ANY) fell 69%, Marathon Digital (MARA) fell 12%, Hive (HIVE) fell 29%, Greenidge (GREE) fell 74%, Bitfarms (BITF) fell 44%, and BitFufu (FUFU) fell 18%.

Overall in 2024, companies have had to adjust to revenue declines as a result of the April halving. This programmed event halves the reward for mining a block every four years since the bitcoin blockchain’s launch, slowing the asset’s maximum supply of 21 million coins, this year the reward was reduced to 3,125 BTC.

According to Blockchain.com, miners had $42 million in revenue as of December 22, up from more than $100 million in April.

At the same time, the difficulty of the network is growing, increasing operating costs for companies. Bitcoin’s current average network difficulty is 108,52 T, an increase of more than 50% year-on-year (72,01 T).

To strengthen their financial position, many public miners have turned to the capital markets. In Q2, 9 of the 13 miners traded on US stock exchanges collectively raised about $1,25 billion through equity offerings. This trend continued in Q3 when an additional $530 million was raised.

The companies also sought to diversify revenues. For example, Core Scientific began leasing rigs to AI startup CoreWeave for computation. This partnership is expected to generate $8,7 billion for Core Scientific over the next 12 years.

Miners are also buying bitcoins to hold on their balance sheets, using the proceeds from securities offerings. The latest to take such a step were Marathon and Hut 8.