The rise is due to higher costs and the April 2024 Bitcoin halving, which increased Bitcoin mining difficulty and reduced rewards.
BitFuFu, a cloud mining company associated with Bitmain, has released an unreviewed financial and operational report detailing its results for the second quarter of 2024, which ended on June 30.
The findings indicate that there has been a substantial increase in the cost of mining Bitcoin in spite of the difficulties and expansion that the company has encountered over the course of the past year.
The study also reported an increase in mining capacity under control, which grew by “62.5% to 24.7 EH/s, compared to 15.2 EH/s during the same period of 2023. This rise coincided with the previously mentioned cost increase.
When it comes to the figures that BitFuFu presented in its report for the second quarter, the most significant shift was the average cost required to mine each bitcoin, which increased to $51,887.
When compared to the $19,344 per mined bitcoin at the same time period in 2023, there is a significant increase. This increase can be attributed to higher electricity and operations expenses. The increase can also be linked to the halving of Bitcoin in April 2024, which increased the difficulty of mining Bitcoin while simultaneously reducing the incentives for mining Bitcoin by fifty percent.
Despite the fact that the company’s Bitcoin mining expenses were up by a large amount, BitFuFu increased the scale of its mining activities. The Bitcoin mining company raised the capacity of its operations by more than sixty percent, bringing the total number of exahashes per second (EH/s) to 24.7.
This action was prompted by an increase in mining-related costs. The Bitcoin mining company also claimed a 70 percent increase in overall revenue, reaching $129.4 million in the second quarter of 2024.
This figure represents an increase from $76.3 million at the same time in 2023.The revenue boost is attributed to the company’s cloud-mining services expansion, which generated a total revenue of $77 million during the period under review.
During an interview with CNBC on August 19, Matthew Sigel, who is the head of digital assets research at VanEck, provided an explanation and stated that the “forced selling” of Bitcoin is now behind us.
According to Sigel, the current status of the cryptocurrency market and the price of Bitcoin are “typical seasonal patterns” that correspond to a period of “one to three months” following half of the supply.
The German government sold 49,858 bitcoins for a total of $2.6 billion during the repayment period for Mt. Gox creditors. This was part of the forced sale that Sigel was referring to.
