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Profitability in bitcoin mining has been declining in recent times. This is not surprising given the declining value of tokens and since profitability largely depends on the price at which BTC is trading, it has led to a decline in cash flow. As the effects of the market crash wave became apparent, the first victims of the decline in profits began to emerge as the bitcoin mining facility closed.
Compass mining loses advantage
Compass Mining Hall is one of the top bitcoin mines in space and has been operating with great success until last month’s crash. The crash prompted many miners to rush to sell their holdings to continue their activities, and some are predicted to go bankrupt next month if lower prices continue. However, it seems that it is starting early for compass mining which has now lost one of its advantages.
Related Reading | Canadian Purpose Bitcoin ETFs suffer massive outflow, but others are slowing down
On Monday, Dynamics Mining took to Twitter To announce That it is canceling its hosting contract with one of the miners. In the tweet, it named Compass Mining and complained that the mining company had failed to pay the agreed electricity usage charges for the benefit.
Interestingly though, it would seem that this was not the recent problem of Compass Mining as Dynamics Mining complained that it has so far received six late payments and three non-payments. It has also been said to have failed to pay monthly fees and has not made payments since February 1, 2022 which was before the last market crash.
BTC trading above $21,000 | Source: BTCUSD on TradingView.com
The hosting company said Compass Mining spent a total of $ 1.2 million on electricity but paid প্রাথমিক 415,000 and $ 250,000 in initial power deposits. In addition, Compass claimed that they paid Dynamics but the hosting companies said they used the money to build their facilities instead.
For clarity compass_mining Energy consumption Dynamics2k Total 1.2 million and they paid only $ 415k and $ 250k initial power deposit. Compass claimed they paid Dynamics2k But money has been used to create their facilities. #True pic.twitter.com/9esvuCFulO
– DynamicsMining (DynamicsMining) June 27, 2022
Bitcoin miners are not doing well
As Bitcoin mining profits decline, mining company stocks are hurting due to the close relationship with the price of Bitcoin. Last week will prove to be a bloody market for them as most mining companies have recorded losses in their stock prices.
The largest companies such as Marathon Digital Holdings and Riot Blockchain saw some of the highest declines with -5.78% and -7.68%, respectively. It has also pulled its market cap and received less attention from investors.
Related Reading | The use of etherium energy is rapidly declining as mining profitability declines
Others such as BIT Mining and Iris Energy, however, went against the grain in this regard. They were among the only few mining stocks to see positive returns last week and went as high as double-digit green figures for a seven-day period. It came in at 11.82% for BIT Mining and 12.13% for Iris Energy.
The biggest drop of the week was seen in Core Scientific, which lost 12.92% of its value and now sits at a market cap of $ 592.237 million. The fall in stock prices also follows the fall in the price of Bitcoin which fell below $ 21,000 over the weekend.
Featured image from SectigoStore.com, chart from TradingView.com
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Thanks for reading: The Bitcoin mining facility has closed after a sharp fall in mining profits, Sorry, my English is bad:)