Global GPU Prices Fall to Offset for Falling Bitcoin Mining Revenue

Global GPU Prices Fall to Offset for Falling Bitcoin Mining Revenue

The big drop in GPU prices has opened up a window of opportunity for small-time miners to procure a piece of more powerful and efficient mining equipment.

The consequences of falling Bitcoin (BTC) prices have had an impact on the total revenue earned by miners in transaction fees and mining rewards, dipping to its one-year low at nearly $15 million on July 4. However, the fall in graphic cards or GPU prices is set to help miners offset their operational costs amid an ongoing bear market.

Bitcoin mining revenue fell 79.6% over 9 months, ever since reaching an all-time high of $74.4 million on Oct. 25, 2021. In addition, a global chip shortage and the coronavirus pandemic shot up prices of the most important part of a mining rig, the graphics processing unit (GPU) further impacting the miners’ bottom line.

With card manufacturers resuming operations across the world, GPU prices have seen a massive decline, with some cards selling for below MSRPs. In May alone, GPU prices dropped over 15% on average as supply exceeded demand. Moreover, the recent influx of GPUs has forced sellers on the secondary markets to bring down their inflated prices on used mining rigs.

However, several public bitcoin miners are conditioned to survive the prolonged bear market as the low revenue continues to sustain the operational costs of the mining facilities. Argo, CleanSpark, Stronghold, Marathon, and Roit are some of the miners with a stable mining revenue to operational cost ratio, a fair indication of their stability.

The sharp dip in GPU prices opened up a small window of opportunity for small-time miners to procure a piece of the more powerful and efficient mining equipment. Coupled with lower hash rate requirements of 203.6 exa hashes per second, miners now require lower computing power to successfully mine a block on the Bitcoin blockchain.

Despite the obvious drop in mining revenue, Marathon Digital Holdings revealed plans to continue mining BTC while remaining "fairly well insulated and well-positioned."

Speaking to Cointelegraph, Charlie Schumacher, VP of corporate communications at Marathon Digital, shared insights on their overall operations:

"For reference, in Q1 2022, our cost to produce a bitcoin was approximately $6,200. We also have fixed pricing for power, so we are not subject to changes in the energy markets."