Bitcoin miners showed a “concerning” trend of pivoting to AI amid a profit squeeze as transaction-fee income barely bounced from 10-year lows of 0.52% of revenue.
Bitcoin (BTC) transaction fees now account for just 0.69% of miner revenue as major players pivot to AI.
Data from onchain analytics platform Glassnode shows that fees as a proportion of miner revenue remain near decade lows after falling to just 0.52% in April.
Miners face ongoing pressure as declining Bitcoin prices and rising electricity costs squeeze profits and force smaller players out of the market. Glassnode co-founder Rafael Schultze-Kraft noted that fees had made up less than 1% of miner revenue for almost a year.
“Bitcoin was below $400 the last time fee share was this low,” he said on X.
Bitcoin fees as a portion of miner revenue. Source: Rafael Schultze-Kraft on X.com
When transaction fee revenue drops, miners increasingly depend on the fixed block subsidy for income — the amount of newly minted BTC awarded for each mined block, currently 3.125 BTC. Bitcoin’s value has fallen nearly 50% since its October 2025 all-time high, dragging down the US dollar value of the block subsidy and further squeezing miners’ profit margins.
The latest data from onchain analytics resource Checkonchain puts the estimated average cost of producing one Bitcoin at $78,254 as of Tuesday — almost 23% above the current spot price.
Bitcoin estimated average production cost. Source: Checkonchain
Bitcoin’s network hash rate, an estimated measure of the computing power securing the network, reflects a mining sector in flux. Hash rate has declined from its October 2025 peak of 1.3 zettahashes per second (ZH/s) to 861 exahashes per second (EH/s), Checkonchain shows — a drop of 33%.
Bitcoin hash rate net position change. Source: Checkonchain
In analysis published over the weekend, independent analyst William Clemente acknowledged the downturn, while noting that miners would have been incentivized to boost activity through automated difficulty readjustments. With difficulty itself now rising again, miners’ shift toward more lucrative AI computing has become conspicuous.
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