According to analysts at JPMorgan, Bitcoin has been trading below its estimated mining cost for five consecutive months. This situation has rendered approximately 20% of miners unprofitable and compelled publicly traded operators to liquidate a record volume of coins.
In a recent client note, analysts led by Managing Director Nikolaos Panigirtzoglou indicated that the economics of Bitcoin mining have “worsened” in 2026. JPMorgan estimates the all-in production cost of Bitcoin to be around $78,000, a figure that encompasses expenses related to electricity, hardware depreciation, and overhead for public miners.
With Bitcoin currently trading near $63,000, the disparity between the spot price and the breakeven point has induced sustained pressure across the mining sector.
A significant observation made by JPMorgan pertains to the structural changes within the Bitcoin network’s response to price fluctuations. The beta of mining difficulty to Bitcoin prices—a metric indicating how mining difficulty adjusts in relation to price changes—has increased to 0.62 over the past six months. This figure suggests that a greater portion of miners are operating at or near their cost floor, frequently switching their machines on or off in response to price variations rather than maintaining steady operations.
This trend became evident in early June when mining difficulty experienced a notable 10.09% decline, marking the second-largest single drop of the year. Additionally, Bitcoin’s hashrate fell by 12% in June, as reported by Galaxy Research. A comparable 10% decline in mining difficulty also occurred in January, signifying two substantial episodes within a single calendar year.
The financial strain has compelled publicly traded miners into a challenging position. Operators such as MARA, CleanSpark, Riot Platforms, Cango, Core Scientific, and Bitdeer collectively sold 32,000 Bitcoin in the first quarter of 2026 alone to cover operational expenses. This volume surpasses their overall Bitcoin sales for the entirety of 2025 and sets a new quarterly record, eclipsing the previous high of 20,000 Bitcoin recorded in Q2 2022 during the bear market that followed the Terra-Luna collapse.
Hashprice, a metric quantifying mining revenue per unit of computing power, currently stands at approximately $33 per petahash per second per day. This pricing trend has placed roughly 20% of the global mining industry in unprofitable territory, as noted in CoinShares’ Q1 2026 Bitcoin Mining Report, which was referenced in JPMorgan’s analysis.
A Contrarian Signal for Bitcoin
Despite the bleak outlook, the analysts at JPMorgan refrain from issuing a bearish conclusion. They observe that weak market sentiment has historically acted as a contrarian indicator for potential future price appreciation.
The team anticipates that heightened hashrate sensitivity and larger difficulty adjustments will persist as long as Bitcoin remains substantially below its production cost.
Furthermore, continued capitulation among higher-cost operators may occur in the first half of 2026 if there is no significant price recovery. At the time of this publication, miners collectively held approximately 1.8 million Bitcoin, a decrease from 1.86 million at the end of 2023, suggesting that treasury drawdowns are a persistent characteristic of the current environment.
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