Bitcoin's mining network is becoming more sensitive to price moves as a larger share of miners operate close to breakeven, according to JPMorgan. The bank said the relationship between bitcoin price changes and mining activity has strengthened this year, with the beta of mining difficulty relative to BTC price moves rising to 0.62 over the past six months. In practical terms, the network's computing power is reacting faster to changes in market conditions.
Mining pressure builds as bitcoin stays below production cost
In a report released last week, analysts led by Nikolaos Panigirtzoglou said mining economics have worsened as bitcoin has remained below its production cost for five straight months. Citing CoinShares' first-quarter mining report, JPMorgan said about 20% of miners are currently estimated to be unprofitable. That leaves less room for miners to absorb weaker prices before having to cut output or sell holdings.
Hashrate measures the total computational power used to mine and process transactions on a proof-of-work blockchain, usually expressed in exahashes per second. JPMorgan said the latest trend points to a larger portion of miners operating near their production costs, which makes the aggregate hashrate more exposed to bitcoin's price fluctuations. A small move can now matter more.
Public miners sold more than 32,000 BTC in Q1
Financial strain has also pushed miners to liquidate more of their bitcoin reserves. Data cited in the report showed publicly traded mining companies sold more than 32,000 BTC in the first quarter, surpassing their combined sales for all of 2025. The figures suggest listed miners have been leaning harder on treasury sales as margins tighten.
The effect is already visible at the network level. When bitcoin trades below production cost, higher-cost operators tend to shut down machines, causing hashrate to fall and mining difficulty to adjust lower. JPMorgan pointed to the second week of June, when mining difficulty dropped 10%, the second decline of that size this year.
Estimated production cost sits near $78,000
JPMorgan expects this higher sensitivity in hashrate and mining difficulty to continue as long as bitcoin remains below its estimated production cost. The bank currently places that cost at about $78,000, while bitcoin was trading around $64,700 at the time of publication.
With mining margins under pressure, more bitcoin miners are turning to artificial intelligence and high-performance computing, or HPC, to diversify revenue. The logic is simple: AI hosting contracts can offer more stable multi-year income streams and better margins than bitcoin mining, which has been squeezed by heavier network competition and the 2024 halving.