Bitcoin miners and mining in general are in trouble.
Brent crude exceeds $113 per barrel after Trump’s ultimatum to Tehran. Energy costs are rising and miners are directly in the firing line. Average production costs already stand at $88,000 per BTC, compared to a spot price of around $69,200. The math is already bad. An energy shock worsens the situation.
Electricity represents 60-80% of miners’ operating costs. When oil prices rise, industrial electricity rates follow. Every rise in energy prices pushes the break-even point even higher than what the market actually pays for Bitcoin.
Fringe miners are running out of runway.
EXPLORE: BTC price risk linked to peak oil
The Hormuz bounty: transmission of the cost of energy to the mining economy
Call it the Hormuz bounty.
Industrial electricity rates in major mining hubs like Texas run on natural gas, and natural gas follows oil during supply shocks. Goldman Sachs raised its forecast for Brent to $110 on average, with potential peaks above $147 if shipping lanes remain blocked. Each additional dollar in oil represents an additional increase in the kilowatt-hour bill.
The miners were already bleeding before that. The sector was operating with an average loss of 21% before the escalation. An increase of 1.5 cents per kWh pushes an Antminer S19j Pro deep underwater. The older S19 series hardware becomes mathematically impossible to use for any grid-connected installation without a fixed rate power purchase agreement.
The Spanish government demands the opening of Hormuz and the preservation of all energy sites in the Middle East.
We find ourselves at a global turning point. Further escalation could trigger a long-term energy crisis for all humanity.
The world should not pay the consequences of…
– Pedro Sánchez (@sanchezcastejon) March 22, 2026
It’s not just a problem of profitability. It’s a solvency problem. Miners caught in trouble have only one option: sell BTC reserves in a volatile market to cover their utility bills. This selling pressure hits the order book at exactly the wrong time.
This restructuring divides the sector in two. Grid-dependent miners in deregulated markets like the United States and energy-importing regions in Europe face the most immediate pressure. Reductions during peak hours or complete shutdowns become the only way to avoid operating at a gross loss.
Mining companies with access to blocked energy networks or dominant hydroelectric networks in Iceland, Quebec or Scandinavia have a structural advantage and maintain it. The analysts’ plan that has kept Brent crude above $120 forces 10-15% of the global offline hash rate, specifically targeting peak fossil fuel operations.
If crude stays above $115, hashing power migrates. Inefficient operators are dumped. What remains is a leaner, more capital-efficient network, but getting there first means a painful capitulation.
EXPLORE: Impact of the Iran War on Bitcoin Infrastructure
Sovereign energy security: the new competitive divide
Hardware efficiency used to be the main problem. The Hormuz crisis has just changed the situation.
Sovereign energy security is the new competitive advantage. Commercial grid pricing has proven to be a liability, and institutional capital is shifting to operations that own their energy source or operate under state protection. Bhutan. El Salvador. Vertically integrated facilities operating on stranded gas, physically disconnected from global export markets.
Access to energy is no longer just a cost variable. This is counterparty risk. Network-dependent miners are one geopolitical shock away from seeing their OPEX double overnight. Operations running on flare gas or remote hydroelectricity are completely outside of this risk. Their input costs remain stable while competitors are charged outside the network.
The price feedback loop is direct. Miners facing margin calls due to rising energy bills have only one solution: liquidate BTC Treasury holdings. This selling pressure hits a market already shaken by geopolitical risk. Santiment data shows that miner balances consistently fall during energy spikes. ETF inflows provide a buffer, but they don’t absorb everything.
No one is talking about Bitcoin’s -40% hash rate collapse from ATH. The largest capitulation of miners since 2021. Ouch. The energy value in turn decreases. This most certainly means that some large miners are abandoning crypto. pic.twitter.com/JKFQmQeHYl
– Charles Edwards (@caprioleio) January 29, 2026
The positive side is structural. Miner capitulation events historically mark the lowest prices. As unprofitable operators go offline, network difficulty decreases, widening the margins of those who survive. The network continues to produce blocks regardless of the macroeconomic chaos around it. On-chain data suggests that a hardship adjustment is approaching, which could provide temporary relief for surviving miners.
But that relief comes later. Right now, the selling pressure is real and caps the upside near $70,000.
Until energy markets signal a de-escalation, the mining company-driven surplus continues. The digital gold narrative is being stress tested in the face of a very physical problem.
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Daniel Frances is a technical writer and Web3 educator specializing in macroeconomics and DeFi mechanics. Hailing from crypto since 2017, Daniel leverages his experience in on-chain analytics to write evidence-based reports and in-depth guides. He holds certifications from the Blockchain Council and is dedicated to providing “insight gain” that overcomes market hype to find real utility for blockchain.
