The hashprice of Bitcoin has hit a two-year low as the wave of AI divides the mining community.

The network difficulty is at a record level and on-chain transaction fees have fallen sharply, pulling Bitcoin mining profits down to the lowest level in two years, creating a clear differentiation between miners operating with razor-thin profit margins and those repositioning themselves as data center operators serving the AI wave.

In the past, the Bitcoin mining industry operated almost in sync with the price fluctuations of this currency. But now, this field is transforming into a two-speed economy — where hash power determines success, rather than energy strategy.

At around 42.14 USD per terahash per day, the “hashprice” — an index measuring miner revenue per unit of computational power — has fallen into the lowest 4% group over the past two years. In just one month, this index has decreased by 19%, while the price of Bitcoin dropping to around 101,500 USD has further increased the pressure.

The chart shows the hash rate price of Bitcoin from August 5 to November 5, 2025 (Source: Hashrate Index)## Main reason: the “problem” of the network, not the price of Bitcoin

The network difficulty has increased by 31% in the past six months, the hashrate has risen by 23%, while transaction fees — which were previously driven by Ordinals activity and network congestion — have fallen to their lowest level since spring. The consequence is a severe “profit compression,” as more and more miners compete for increasingly smaller rewards.

For small miners, this is a devastating blow. Many units are operating below breakeven, especially those facing high electricity costs or using old equipment. The current situation recalls the bottom of the cycle in 2020 and the end of 2022, when weak players were forced to withdraw just before the market recovered.

AI opens up a new “way out” for miners

Unlike previous cycles, this test takes place in a completely different context: the explosion of AI and high-performance computing (HPC) has created a new direction for mining companies, helping them to transform their infrastructure to serve non-Bitcoin workloads.

Earlier this week, Iris Energy announced a 9.7 billion USD deal over 5 years with Microsoft, providing AI capabilities and data centers — essentially restructuring part of the mining team into a HPC service provider. The market reacted immediately, brokerage firms began to re-evaluate IREN, Core Scientific, Riot Platforms, and Cleanspark as “AI infrastructure stocks” rather than purely representing Bitcoin.

This transition — along with the actual diversification of revenue — helps the stocks of mining companies rise even though hashprice is declining. The market is beginning to value the flexibility in energy and long-term contracts more than just focusing on hash output.

Those who do not adapt will be left behind

Companies solely focused on Bitcoin mining are getting stuck as profit margins shrink. Their revenues are currently at the lowest level since April, with hashprice around 43 USD per PH/s/day — nearly hitting a multi-month low. As they remain entirely dependent on block rewards and transaction fees, each time the difficulty increases, profits decrease.

If they cannot hedge against risks or access cheap electricity, they have to wait for the next halving event or a new increase in transaction fees.

Meanwhile, Marathon Digital is proving the advantages of scale. The company just announced a record profit of 123 million USD in the quarter, thanks to an optimized operational focus and expansion into AI-related business areas. The current revenue of Marathon is a blend of Bitcoin mining and AI services, indicating that the concept of “miner” is being redefined. The massive energy infrastructure allows the company to flexibly manage load, sell excess power, or lease HPC infrastructure when mining economics become less attractive.

The market is clearly differentiated

Stock investors now see the decline in hashprice not as a survival risk, but as a test to distinguish who has a sustainable business model and who is just chasing block rewards. As noted in Bernstein's memo:

“Hashprice fall does not affect miners shifting towards AI.”

This statement reflects a reality: Bitcoin mining is evolving from a single-target activity into a multi-market data infrastructure.

When can the downtrend reverse?

Three important signs to watch for:

1. Difficulty peaks or falls slightly — when inefficient miners shut down, helping to redistribute rewards to those who remain.
2. On-chain fees recovery, whether from congestion or the new usage wave of Ordinals, can raise hashprice without the need for Bitcoin prices to increase.
3. The AI/HPC contract expansion, each megawatt redirected from the Bitcoin network will fall competition, improving profit margins for the rest.

Factors such as winter electricity prices, regional regulation policies, or trends in mergers and liquidations also affect the situation. Typically, when hashprice hits the bottom of the cycle, the market is about to enter a recovery phase.

The upcoming difficulty adjustment will be a true test of the resilience of the entire industry. If the hashrate stagnates and fees increase, the hashprice may gradually return to a state of balance.

Until then, the mining industry remains divided — between those solving the “hardest problem of Bitcoin” and those rewriting it with AI.

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