The rising operational costs and lower rewards are taking its toll on Bitcoin ( BTC ) miners but it isn’t at catastrophic levels by any means, according to a cryptocurrency analyst.

“We are in a period of hash ribbon inversion, and blocks are coming in about 14 seconds slower than they should do, that tells you that there is less hash rate online, blocks are being found slightly slower,” Glassnode lead analyst James Check aka “Checkmatey” said in a June 21 X video .

“About 5% of mining hashrate is struggling about the moment,” Check explained, referring to the amount of processing and computing power being given to the network through mining.

James Check speaking about Bitcoin mining hashrate. Source: Checkonchain/Youtube

Check claims that “5% isn’t enormous” and it is likely that Bitcoin miners are “likely” to be distributing some of their holdings, but it doesn’t appear to be a “complete and total firesale.”

A hash ribbon inversion occurs when the 30-day moving average of the hash rate crosses below the 60-day moving average, signaling a period of mining difficulty. This can be due to several reasons including increased operational costs, a decline in Bitcoin’s price, or equipment issues among miners.

Following the Bitcoin Halving on April 20, the Bitcoin hash rate started to see a decline as Bitcoin mining firms started turning off unprofitable mining rigs. Every four years, the halving event occurs, cutting miners' rewards in half.

The April 20 halving reduced mining rewards to 3.125 BTC from 6.25 BTC.

Bitcoin Total Hash Rate (TH/s) Chart. Source: Blockchain.com

At the time of publication, the Bitcoin network’s hash rate is 586 exahash per second (EH/s), down 2% over the past 30-days, according to Blockchain.com data .

Check suggested that while miners may be doing it tough right now treading water, at worst they may be breaking even as they mine new Bitcoins, to cover operational costs.

Bitcoin miners may be in a period of just breaking even

“Miners might be treading water up here, they may not be full scale bear market level capitulating, probably just treading water, they mine ten bitcoin, they sell ten bitcoin,” Che said, following other analysts comments in recent times about the lack of profitability for Bitcoin miners.

“Bitcoin miners are selling most of their coins to pay the bills,” Panos wrote in a June 18 X post .

In a separate post on X on the same day, Check noted that Bitcoin “transaction fees represent an increasingly large proportion of miner revenues.”

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“Miners must adapt and adjust to fees becoming their primary revenue stream, forcing the industry to further innovate, and apply efficient capital management,” he wrote on X.

“Nearly all Bitcoin miners are selling 100% of their coins, while CLSK is managing to Hodl their BTC use their relatively USD balance sheet to acquire new capacity,” VanEck head of digital assets research Matthew Sigel  wrote .

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