(rejected) Bitcoin Bulls Make Miners to Smile All The Way to The Bank as Pre-Halving Profits Get Restored

New data from Glassnode reveals that Bitcoin (BTC) miners’ profits have been restored to pre-halving levels following the recent BTC bull run past $18,000. The on-chain market analytic firm suggests that the BTC mining revenues are now at par with what miners used to make before the halving event, which happened in May.

Bitcoin halving slashes miners’ profits by 50%

Bitcoin halving refers to the reduction of Bitcoin block rewards, which occurs once every 210,000 blocks are created after approximately every 4 years. Block reward refers to the amount of Bitcoin received by miners after they successfully validate a new block. The rationale behind this is Bitcoin’s design, whose total supply is capped at 21 million coins. 

Bitcoin’s third Halving took place on May 11, effectively reducing the block rewards from 12.5 to 6.25 BTC per new block. This was the third time in its history that this event was happening because the previous ones occurred in 2012 and 2016. Precisely, Bitcoin's block rewards went down to 25 from 50 bitcoin per block in November 2012 and further decreased to 12.5 units in July 2016. 

Back to 12.5 BTC per new block

The data availed by Glassnode, therefore, indicate that the recent Bitcoin price rally, which surpassed the $18,000 mark, made miners earn 12.5 BTC per new block compared to 6.25 as is the case post-halving.

The logic behind halving events is that as more people utilize the Bitcoin network, more BTC gets mined. Therefore, by slashing the rewards for mining by half, retrieving this digital asset becomes difficult, making its value to increase. 

Despite Bitcoin miners smiling all the way to the bank, things have not been that rosy for Chinese miners because 74% of them have been facing difficulties paying their electricity bills. This is because the government has been on a nationwide operation to freeze bank cards linked to crypto transactions. The recent Bitcoin bull run has also triggered a growing interest in this digital asset as evidenced by the nearly 25,000 BTC addresses generated in a single hour.