Bitcoin Mining Profits Plummet Amid Intensifying Competition and Rising Costs

As of November 13, 2025, the bitcoin (BTC) mining industry is entering a challenging phase marked by intensifying competition, rising energy demands, and shrinking profits. According to Fred Thiel, the CEO of MARA Holdings (MARA), bitcoin mining has become a "zero-sum game" where the addition of more mining capacity makes it increasingly difficult for everyone else.

Thiel paints a picture of a maturing and more brutal industry, where only miners with access to low-cost, reliable energy or those who can pivot to new business models will be able to survive. Many mining firms are now shifting their focus to adjacent fields, such as artificial intelligence or high-performance computing (HPC) infrastructure, as they struggle to remain competitive.

The situation is expected to become even more dire after the next bitcoin halving in 2028, when block rewards will be cut in half to just over 1.5 BTC. Unless transaction fees rise or the price of bitcoin surges, the economics of mining will become unsustainable for a significant number of players. Thiel warns that by 2028, miners will either need to be a power generator, be owned by one, or partner with one to remain profitable.

In this challenging environment, smaller miners are facing intense pressure, while larger players are adapting by controlling their energy sources and investing in private infrastructure for AI and HPC. Thiel's strategy is to be in the lowest quartile in terms of production cost, as he believes that in a tight market, 75% of the other miners will have to shut down before his company does.