Bitcoin (BTC) miner Marathon Digital produced 979 BTC in June, down 21% from the 1,245 BTC it mined a month earlier and up 599% from a year ago. The company said that the month-on-month drop in production numbers comes amid weather-related headwinds in Texas and declining Bitcoin transaction fees.
Marathon’s Operational Hash Rate Up 16%
Marathon Digital released its Bitcoin production and mining operation update for June 2023. According to the document, Marathon mined 979 BTC last month, down 21% from May and up 599% year-over-year.
Meanwhile, the miner’s operational hash rate rose by 16% in June month-over-month to 17.7 exahashes, while its installed hash rate – the total computing power dedicated to cryptocurrency mining within a specific network or system – climbed 8% from May to 21.8 exahashes.
Thiel said the company plans to achieve its exahashes per second (EH/s) target through its new facilities in Ellendale, ND, and GardenCity. The final building in Ellendale is expected to start operating in July, while the “final Garden City tie-in is also expected within that same period.”
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Lower BTC Transaction Fees Weighing on Marathon’s Production Numbers
The miner’s CEO, Fred Thiel, said the month-on-month production decline comes due to weather-related constraints in Texas, where its facility is based. In addition, a notable drop in transaction fees also contributed to weaker production in June, Thiel added. In particular, fees slumped to “approximately 5.1% of the total bitcoin we earned in June compared to 11.8% in May.”
“The emergence of Ordinals significantly increased transaction fees in May, and while network congestion eased in June, we view recent trends as a positive sign for the future of mining economics.”
– Fred Thiel, Marathon Digital’s CEO said.
Bitcoin Ordinals, which some refer to as Bitcoin non-fungible tokens (NFTs), represent a protocol that allows users to inscribe digital artifacts like text, image, or video on a satoshi, the smallest denomination of Bitcoin. Introduced early this year, Ordinals attracted widespread attention recently, lifting BTC daily fees to $3.5 million in May.
However, the hype around Ordinals started to cool down more recently, leading to declining transaction fees and the number of mined Bitcoins. Despite this, Marathon Digital remained optimistic about the future outlook.
The mining firm’s shares were up 3.2% in premarket trading Thursday after closing at $15.56 on July 5.
What do you think about the outlook for the crypto mining sector for the remainder of 2023? Let us know in the comments below.
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