CoinShares: 20% of Bitcoin Miners Now Unprofitable

• CoinShares estimates that between 15% and 20% of the global Bitcoin mining fleet is currently operating without profit.
• The hashprice metric hit a post-halving low of $28 per petahash per day in February 2026 before slightly recovering.
• Bitcoin's mining difficulty experienced a significant 7.7% reduction on March 20, reflecting the exit of struggling operators.

Narrowing Profit Margins and Hardware Efficiency

A recent report from asset manager CoinShares for Q1 2026 highlights a tightening economic environment for Bitcoin miners. The hashprice, which represents the expected value of mining power, reached a five-year low of $28 per PH/s/day earlier this year. Although it has since climbed back to approximately $33, the recovery has not been enough to keep all operators in the green.

The report notes that profitability is increasingly tied to the efficiency of hardware and the cost of energy. Miners utilizing mid-generation hardware are particularly vulnerable; those paying $0.05 per kilowatt-hour or more for electricity are currently operating below their breakeven point. In contrast, those with the latest-generation equipment can still maintain healthy margins at standard industrial electricity rates.

Market Squeeze and Network Difficulty Adjustment

The combination of lower Bitcoin prices, rising network difficulty, and stagnant transaction fees has created a "mining squeeze." This pressure is already visible in network-wide data. On March 20, the Bitcoin network saw its mining difficulty drop by roughly 7.7%, one of the most drastic declines of the year. This adjustment occurs when miners shut down unprofitable rigs, reducing the total computational power and making it easier for remaining participants to secure blocks.

Long-term Outlook and Price Sensitivity

According to James Butterfill, head of research at CoinShares, the future of the mining sector depends heavily on Bitcoin's price performance. Butterfill suggests that if Bitcoin remains below the $80,000 mark for the rest of the year, the hashprice will likely continue to struggle or flatline as less efficient operators are forced out of the market.

Strategic advantages are now the primary differentiator in the sector. The current environment favors operators who have:

• Access to electricity priced below 5 cents per kilowatt-hour.
• Structural advantages like highly efficient, new-generation hardware fleets.
• Scalable operations that can withstand periods of low revenue.