Bitcoin miners took a back seat in mining profitability during the month of January as ethereum miners saw a 20% increase in revenue over bitcoin miners.
January proved to be a tough month for bitcoin miners. Miners were able to generate approximately $1.2 billion in revenue during the first month of 2022, according to BeInCrypto Research. While the figures seem impressive, the total revenue for January was down $220 million compared to December 2021, a staggering 15% decrease in mining revenue.
Mining revenue still increasing from 2021
The decrease in mining profitability over the last month would have had little effect on long-term miners. The total profitability of bitcoin mining over the past year was up 8% since January 2021, which saw $1.1 billion in revenue recorded.
Bitcoin active addresses breaks one million in January
While bitcoin mining revenue declined in January, the amount of active addresses rose from a low of 700,000 at the beginning of the month, to eventually surpass one million by month end.
Bitcoin miners revenue single day high set at $60.16 million
Although bitcoin mining revenue was down in January, the single day high on revenue for January 2022 was still 29% higher than the highest day in January 2021. The single day high for January 2022 saw $60.16 million in revenue, while January 2021 saw $46.31 million.
February mining revenue currently sits at $548.22 million at the time of writing, with February 12 seeing a single day high so far, of $50.02 million in mining revenue.
Ethereum outpaces bitcoin mining
While bitcoin miners managed $1.2 billion in January revenue, ethereum miners managed to mine $1.47 billion. In similar fashion to bitcoin, mining revenue declined by 23% from December 2021. December 2021 saw a total revenue in ethereum mining of $1.91 billion. Ethereum mining also saw a year-on-year monthly increase for January. January 2021 saw $1.31 billion in revenue recorded, with 2022 increasing by 11%.
Miners prefer ethereum
Bitcoin remains the top digital asset by market capitalization. However, based on mining statistics, ethereum is a clear favorite. Before the overall decline in mining revenue in 2022, December 2021 saw ethereum mining revenue outpace bitcoin by 32%, with ethereum a clear favorite in January 2022, with 20% more revenue than bitcoin.
What caused the mining revenue decline?
Declining market prices can be credited as the key attribute for the drop in mining revenues. According to BeInCrypto Research, bitcoin opened December 2021 at $56,907. However, declining market conditions saw the price close out 2021 at $46,306.
Bitcoin continued to slide as it dropped a further 21% in January 2022. Closing out January 2022 at $38,483. The total market capitalization of bitcoin had fallen by approximately $280 billion since the beginning of December 2021.
In similar fashion, ethereum began December 2021 at $4,623. The price of ethereum mirrored that of bitcoin. Falling over 20% in December 2021. Ethereum would end the year at $3,682. The decline would become more violent in January 2022. Ethereum would plunge a further 29% by the end of January 2022, reaching a price of $2,688. In a matter of two months, ethereum had lost nearly 40% of its market capitalization.
By the end of January 2022, bitcoin and ethereum had seen price declines of 44% and 45% respectively, from their all-time highs in November 2021.
Miner revenue can be calculated by taking the number of coins earned by the price of the coin at its trading price at a given period. This would explain why there was a decrease in mining revenue value in January 2022.
February should see more impressive mining revenue figures as both cryptocurrencies see a bounce from the January bottoms. Bitcoin has climbed 15% in February already, reclaiming $44,000. While ethereum currently holds support above the $3,100 mark.
Analysis provided by Raphael Minter at BeInCrypto Research