The air in the room thickened with smoke from Nicaraguan cigars as a stout
Bitcoin
miner from the Deep South described the rapid growth of the industry.
“You have no idea,” he shared during this year’s Mining Disrupt pre-party in Fort Lauderdale, Florida, before adding a well-known Bitcoiner adage—echoed by President Trump on the campaign trail—that one should never part with their holdings.
Having been part of the scene since its inception, he reminisced about purchasing a Ferrari with Bitcoin years ago, now laughing at his regret given the asset’s meteoric rise.
Bitcoin has seen continuous growth over the years, recently reaching
new heights
following President Trump’s victory in November. The new leader pledged during his campaign to support the industry after previous regulators had imposed stringent measures on crypto firms during ex-President Joe Biden’s time in office.
Optimism was palpable at the event, yet a sense of gloom also permeated the world’s largest crypto mining expo this week, as participants in this fast-evolving and niche sector revealed their difficulties in maintaining profitability in an increasingly competitive and costly Bitcoin mining landscape.
For instance, the
price of Bitcoin
has dropped by 24% since its record peak in January, trading at under $83,000. Meanwhile, mining difficulty has surged to unprecedented levels—and rapidly.
“It’s just incredibly challenging to keep pace,” remarked one individual running a modest business in the fiercely competitive market, opting to remain unnamed. He swiftly shifted the conversation to his Solana-based side project.
Navigating Challenges
Engaging in Bitcoin mining is a complicated, yet pivotal domain within the crypto sector. While there is a general awareness of its importance—President Trump himself acknowledged the necessity of safeguarding the enterprise—the technical aspects may elude many.
Even among crypto enthusiasts.
The crux is simple: mining Bitcoin demands considerable resources—chiefly affordable energy—to power the noisy, robust machines that uphold the payment network. Miners, usually large-scale industrial entities, earn newly minted digital coins by processing a block on the blockchain.
As the network expands—as intended—the difficulty of mining increases. This leads to a greater demand for resources to remain operational. When Bitcoin’s price declines, the revenue from selling Bitcoin rewards may not suffice to cover operating costs.
In essence, Bitcoin mining is a challenging industry. This was a recurring theme at the conference, particularly in conversations about how mining operations might diversify their activities.
“There’s a tremendous opportunity in Bitcoin mining,” asserted data center expert Chad Everett Harris with enthusiasm during a panel, attempting to persuade miners to venture into AI-related businesses for supplementary income—a growing trend.
Paul Li, CEO of mining tech firm Fog Hashing, emphasized that miners could not afford to overlook the burgeoning AI wave.
However, as Decrypt discovered, the transition from minting “digital gold” to managing AI data centers is no small feat—even for the industry giants.
If even Nasdaq-listed miners find the prospect of entering the AI space daunting—a venture that is both costly and intricate—what does that imply for the smaller players?
A New Era?
Before his election, President Trump
insisted that he would advocate for all future Bitcoin to be entirely American-produced.
Miners were mostly reluctant to engage in political discussions with Decrypt, and there wasn’t a red hat in sight at the event—contrasting with the MAGA-heavy Bitcoin 2024 Nashville event from last summer. Yet, a sense of relief regarding the new administration emerged among miners.
“The new administration is favorable toward Bitcoin and Bitcoin mining,” stated Shanon Squires from Compass Mining in an interview with Decrypt. “The geopolitical risks have diminished—at least in my view.”
Nevertheless, as Bitcoin mining escalates in resource demands due to its increasing mainstream acceptance, a cryptocurrency-supportive president might not be sufficient for smaller entities to survive.
“It’s a legitimate business,” Squires emphasized. “You must achieve efficiencies at scale, understand your operations, be cost-effective in both acquisition and procurement, and operate a genuine enterprise.”
“It’s not like a crypto ICO where you profit from nothing,” he concluded.
Edited by Andrew Hayward
Daily Debrief Newsletter
Start each day with the latest top news stories, along with original features, podcasts, videos, and more.
