Analysis: Despite the soaring price of Bitcoin, most mining company stocks will still struggle to match its increase by 2024
According to reports, as of December 24th, Bitcoin's return rate reached 113% in 2024. However, most mining stocks failed to fully capitalize on the rise of cryptocurrencies, closing the year in a downtrend. Data from the Hashrate Index and Google Finance shows that the majority of listed mining companies performed poorly at the year's end, with the highest drop reaching 84%.
Out of 25 listed mining companies indexed, only 7 have generated returns for investors this year. As of this writing, Bitdeer (BTDR) is up 167%, Cipher (CIFR) has risen by 33%, Hut 8 (HUT) by 91%, Iris Energy (IREN) by 72%, Northern Data (NB2) by 58%, Core Scientific (CORZQ) by 327%, and TeraWulf (WULF) by 169%. On the other hand, Argo Blockchain (ARB) fell by 84%, followed by Sphere 3D (ANY) with a 69% drop, MARA Holdings (MARA) by 12%, Hive (HIVE) by 29%, Greenidge (GREE) by 74%, Bitfarms (BITF) by 44%, and BitFufu (FUFU) by 18%, to name a few.
Overall, 2024 was a year of adaptation for Bitcoin mining companies as they addressed issues of reduced rewards and increased costs, seeking new sources of revenue to sustain operations. Bitcoin miners accumulated more than $71 billion in revenue. According to Blockchain.com, miner income on December 22nd was $42 million, while the peak in April exceeded $100 million. Meanwhile, the current average difficulty of the Bitcoin network is 108.52 T, up from 72.01 T a year ago, marking a 50.71% increase over the past 12 months. As operational costs have risen, mining expenses have also significantly increased.
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