Bitcoin is trading about 20% below its mining cost, with production cost estimated at $62,500. A JPMorgan report citing CoinShares data says nearly 20% of miners are now operating at a loss. Publicly traded mining companies, under pressure to fund operating expenses, sold more than 32,000 BTC in the first quarter alone. That total already exceeded all of their combined BTC sales in 2025.
Five straight months below production cost raise pressure on miners
JPMorgan said BTC has traded below production cost for five consecutive months, forcing some miners to liquidate holdings as financial stress builds. The gap between mining revenue and costs has narrowed, while electricity and equipment expenses remain heavy. Smaller or less efficient operators are exposed the most. If prices stay under cost for a longer stretch, some of them may have to leave the sector.
Difficulty fell 10% in early June after hashrate pressure
The Bitcoin network responds through its automatic adjustment system. When BTC drops below production cost, higher-cost miners tend to shut off machines, reducing total network hashrate. That decline feeds into a lower mining difficulty, making block production easier for miners that remain online. The report notes that mining difficulty is updated roughly every two weeks.
This mechanism kicked in again in early June, when mining difficulty dropped by 10%. It was the second major decline of that size this year, a sign that the network is still adjusting to mounting miner stress. Lower difficulty can ease some of the burden, but it does not change the fact that spot prices remain below production cost.
Mining operations are reacting faster to price swings
JPMorgan said miners are responding to price changes faster than before. According to the bank, network difficulty has become more sensitive to real-time prices because more mining operations are running close to break-even. As a result, operators are switching equipment on and off more often in response to short-term market moves. As long as BTC stays below production cost, the bank expects larger and more frequent difficulty adjustments.
JPMorgan keeps a cautious view on the broader market. At the same time, the report says negative sentiment can also be read as a contrary signal by some investors, pointing to major institutional accumulation and declining exchange reserves as signs that lower prices may be attracting buyers.