Key Takeaways:
- Bitcoin mining is increasingly competitive; energy costs determine survival.
- The 2028 halving will cut rewards, pressuring smaller miners.
- Controlling or partnering for cheap power is crucial for long-term viability.
- Innovation in AI and high-performance computing can provide a strategic edge.
Bitcoin Miners Face Survival Test Ahead of 2028 Halving
The bitcoin mining industry is approaching a critical juncture. MARA Holdings CEO Fred Thiel warns that only miners with access to cheap energy or innovative strategies are likely to survive the next BTC halving in 2028. Smaller miners relying on the grid face mounting pressure as competition grows and profit margins shrink.
Mining Is a Zero-Sum Game
Mining bitcoin (BTC) involves using high-powered computers to solve complex algorithms, validate transactions, and add blocks to the blockchain. In return, miners earn bitcoin rewards. Thiel describes this as a “zero-sum game”: as more participants enter, competition intensifies, and margins narrow.
“Your floor is your energy cost,” Thiel told CoinDesk. Miners controlling energy sources or pivoting to high-performance computing (HPC) and artificial intelligence (AI) are best positioned to thrive, while grid-dependent operators may struggle. Some hardware vendors and large players, including Tether, are already mining efficiently, outcompeting smaller firms.
The 2028 Halving: Stakes Are High
Bitcoin halving occurs roughly every four years, cutting block rewards in half to limit the total bitcoin supply. The next halving will reduce rewards to around 1.5 BTC, placing further pressure on profitability unless bitcoin prices rise sharply or transaction fees increase.
Also Read : What Is Bitcoin Halving?
“Bitcoin was designed with the idea that transaction fees would eventually replace the subsidy,” Thiel explained. “But that hasn’t happened. If growth doesn’t hit 50% annually, the math gets very tough after 2028.” Smaller miners, already vulnerable, could be forced out as energy costs become a decisive factor.
Control Energy or Risk Obsolescence
Thiel predicts the future of mining will favor those generating their own power or partnering with energy providers. “By 2028, you’ll either be a power generator, be owned by one, or be partnered with one,” he said. Larger operators are consolidating advantages through private infrastructure and strategic energy control, while less efficient miners are gradually exiting the market.
Also Read: Bitcoin Bulls Beware: Are $100K Levels at Risk?
Mining, however, remains a critical backbone of BTC, validating transactions and driving technological innovation in computing efficiency. Miners who adapt—reducing energy costs and exploring AI or HPC—will survive and potentially thrive.
