Bitcoin Miners Are Making $1 Million Every Hour. Here's How

By Decrypt Staff

It’s not just Bitcoin traders who’ve profited from Bitcoin’s bull run this year. Bitcoin miners, too, are rolling in the money. They’re earning $1 million every hour, according to data from Glassnode—the most lucrative 60 minute stretches since July 2019.

That’s an increase in revenue of 185% since the Bitcoin halving, said the metrics firm, in reference to Bitcoin’s big day in mid-May when the network cut the number of Bitcoin that miners receive for processing transactions on the blockchain in half, constricting the supply of new Bitcoin.

Glassnode pointed out that today’s big number is all the more impressive considering that in July 2019, “block rewards were twice as high than today.”

Bitcoin miners earn fees from processing transactions. They do this by solving complex computational puzzles on the blockchain. The most powerful computers beat the rest to the punch, meaning that miners have to become ever more powerful to compete.

Miners make more money when there’s more activity on the Bitcoin blockchain. People are buying lots of Bitcoin because of this year’s bull run, which has whacked on an additional $17,000 to its price tag since the start of October.

Miners are making so much money right now because there’s more demand for processing transactions. They earn Bitcoin from each block they verify, as well as all of the transaction fees included in each block.

But they make even more money when demand outstrips supply; the network hikes up fees in times of congestion, meaning that Bitcoin miners powerful enough to earn fees stand to profit.

As of yesterday, the average cost of processing a Bitcoin transaction stood at $8.7, according to BitInfoCharts.com.

Glassnode pegs the total revenue of Bitcoin miners to date at $13.8 billion. It's big business. Yesterday, the stock prices of companies that operate and produce Bitcoin mining computers boomed.

Shares in Bitcoin mining company HIVE Blockchain Technologies rose by 27% yesterday. Colorado-based mining company Riot Blockchain’s stocks increased by 22%, and shares in Marathon Patent Group—one of the biggest mining companies in the US—soared by 12%.

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