The decline in bitrate is squeezing Bitcoin mining, with mining profits falling to record lows due to the price drop since October.

LiquidationWizard · 2026-02-14T23:01:49+00:00

The Bitcoin mining industry faces significant challenges due to a 38% price drop since October, resulting in record-low mining revenues and negative cash flow for many miners. The decline in hash rate, down 12%, reflects operational cutbacks, while mining facilities increasingly pivot to AI computing for better profitability. This transition threatens Bitcoin's security and network decentralization, risking the long-term stability of the Bitcoin network.

LiquidationWizard

2026-02-14 23:01:49

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The Bitcoin mining industry is facing an extremely challenging situation. The sharp decline of 38% in Bitcoin price since October has also led to a deterioration of hash rate-related metrics, causing mining revenues to drop to their lowest levels ever. According to a report by data analysis firm NS3.AI, this rapid decline in profitability has forced many miners to operate with negative cash flow.

Miner Crisis and Hash Rate Decline

The market downturn is directly reflected in the network’s hash rate, which has decreased by 12% alongside the drop in Bitcoin price. This suggests that miners are shutting down mining equipment or scaling back operations. When mining costs exceed revenues, it becomes inevitable for individual miners to withdraw from the market.

Meanwhile, traditional mining facilities and existing power contracts are rapidly being repurposed for AI computing applications in pursuit of higher profitability. This structural shift is developing into a fundamental issue affecting the core of the Bitcoin network.

Facility Conversion to AI Industry Threatens Network Security

The outflow of mining resources to the AI industry poses serious risks to Bitcoin’s security budget and network decentralization. The reduction in hash power caused by lower Bitcoin prices diminishes the network’s verification capacity.

If this trend continues, it could lead to significant long-term security challenges for the Bitcoin network. Centralization among miners may increase, and there could be a structural shift toward greater dependence on transaction fees. The deteriorating economics of mining operations and the worsening hash rate metrics are not merely market phenomena but issues that threaten the fundamental stability of the network.

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