Bitcoin Mining Becomes Pricier Than Ever — Here’s What’s Driving It
Bitcoin mining production costs are projected to exceed $70,000 per BTC in Q2 2025, as rising network hashrate and energy prices continue to squeeze miner profit margins, according to a new report from mining research firm TheMinerMag.
In its May/June industry update, TheMinerMag stated that median production costs already increased from $52,000 in Q4 2024 to $64,000 in Q1 2025, and are expected to jump another 9.4% in Q2, crossing the $70,000 threshold. This rise in costs puts additional pressure on less efficient miners, particularly those struggling to modernize their fleets or secure cheaper energy sources.
Rising Bitcoin Price Offers Some Relief
Despite rising production costs, Bitcoin’s current price of around $107,635 offers a significant buffer for most miners. However, the report notes that this cost estimate does not factor in depreciation of mining hardware or other overheads like rented machines and infrastructure maintenance.
As a result, miners are focusing on fleet optimization and efficiency, especially managing their fleet hashcost — the cost per unit of computing power (PH/s). In Q1 2025, the median fleet hashcost remained stable at $34 per PH/s, but some firms like Terawulf and Bitdeer saw over 25% increases in production costs, driven mainly by rising electricity rates, which climbed to $0.081 per kWh, nearly double from $0.041 in Q1 2024.
Mining Stocks Diverge as Investors Prioritize Diversification
Meanwhile, Bitcoin mining stocks have shown mixed performance. Investors are increasingly favoring companies with revenue diversification beyond Bitcoin mining, such as AI hosting and high-performance computing (HPC).
Between May 4 and June 13, IREN (Iris Energy) surged 21.4%, while Core Scientific (CORZ), Bit Digital (BTBT), and Cipher Mining (CIFR) posted strong double-digit gains. Conversely, Canaan (CAN) and Bitfarms (BITF) dropped over 21% each.
The widening gap between top and bottom performers underscores a shift in investor focus from pure mining operations to multi-revenue business models within the digital infrastructure space.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Cryptocurrencies and stocks, particularly in micro-cap companies, are subject to significant volatility and risk. Please conduct thorough research before making any investment decisions.
