Bitcoin Mining Industry Faces Perfect Storm of Challenges as Profitability Plunges

Profitability Crisis Hits Mining Operations

The Bitcoin mining industry is experiencing severe headwinds as a critical profitability metric dropped to levels that threaten the viability of many operations. Hashprice, which measures expected profits per unit of computing power, plummeted to approximately $35 per terahashes per second (TH/s) in November as Bitcoin prices fell to around $80,000^[1].

This decline is particularly concerning since mining operations typically become unprofitable around the $40 TH/s level^[1]. While the hash price has recovered slightly to about $39 TH/s, it remains in a precarious zone for many miners^[1].

Major Players Exit and Face Scrutiny

The challenging environment has already claimed casualties. Stablecoin issuer Tether confirmed it shut down its mining operations in Uruguay on Tuesday, citing surging energy costs as the primary reason for the exit^[1]. The company was also embroiled in a dispute with a local state-owned energy provider over $4.8 million in unpaid energy bills and fees^[1].

Meanwhile, Bitmain, one of the leading mining hardware manufacturers controlling approximately 80% of the mining hardware market share, is now under investigation by US officials over national security concerns^[1]. Authorities are probing whether Bitmain's application-specific integrated circuits (ASICs) could be remotely accessed and used for espionage^[1]. Any potential ban on the Chinese company's products could create additional challenges for an already struggling industry^[1].

Industry Evolution and Growing Competition

Despite these setbacks, the Bitcoin mining market has grown significantly in scale, complexity, and competitiveness over the past year. The global hashrate surpassed the symbolic one zetahash per second (ZH/s) in August, according to CoinWarz data^[2].

"This reflects both increased investment and the deployment of ultra-efficient mining hardware such as the Antminer S21 series," Bitfinex analysts noted^[2]. "In short, the Bitcoin mining market of 2025 is more industrialized, technologically advanced and geographically dispersed than it was in 2024, but also more competitive and volatile."^[2]

However, increased competition has not translated to higher output. Bitcoin's circulating supply added approximately 155,000 BTC between November 27, 2024, and November 27, 2025—a 37% decline from the 245,000 BTC added in the preceding year, according to Blockchain.com data^[2].

Hobbyist Miners Stage Comeback

In an unexpected turn, individual and hobbyist miners are re-entering the market despite intensifying industrial competition and rising costs. This resurgence is being supported by improvements in mining pool technology^[2].

"Tools such as CKPool—a solo-mining-friendly platform known for low latency—have helped make this practice more accessible," Bitfinex analysts said^[2]. The analysts also observed a viral social trend for "lottery wins" by solo miners, particularly those using efficient, low-noise mining devices at home^[2].

"Hobbyist mining—not quite solo, but also not industrial—has seen a mini renaissance," according to Bitfinex analysts^[2]. This trend has been driven by the availability of efficient, low-cost ASICs, the use of off-peak electricity strategies, heat recycling methods, and firmware such as BraiinsOS, which allows miners to underclock devices for optimal efficiency^[2].

The contrast between struggling industrial operations and the revival of small-scale mining highlights the complex dynamics reshaping the Bitcoin mining landscape as the industry adapts to new economic and regulatory realities.