Bitcoin [$BTC] miners are in a tight spot as market distress deepened to levels last seen in 2019. The ripple effects could affect Bitcoin network security.
According to Charles Edwards, founder of venture firm Capriole Investments, $BTC miner transaction fees have fallen to a 7-year low despite the crypto asset’s value growing 13x. For him, this is one of the reasons miners are pivoting to artificial intelligence (AI).
Miners’ total revenue is dictated by transaction fees and block rewards (which are sliced every four years in what is called halving cycles). With declining block rewards, transaction fees have long been expected to fill in the revenue gaps to keep miners afloat.
However, the trend could pose a risk to network security, Edwards cautioned.
It’s no wonder all the miners are leaving for AI. What does this mean for Bitcoin security going forward if this trend holds?
Bitcoin miner revenue drops to $30M
The Bitcoin price has also declined by half from +$126K in late 2025 to above $60K in 2026. This devaluation has impacted miners too. As of July, the daily block subsidy has dropped below $30 million while transaction fees were at $210K.
This was a twofold drop from mid-2025 daily miner revenues of $60 million. In fact, when zoomed out to the 2024 record of $95 million in revenue, the current levels were three times lower.
As such, the crypto winter and contracting mining revenues have put $BTC miners in a tight spot. According to MacroMicro, the average cost of mining $BTC was about $70.5K as of the 4th of August. In other words, at the current price of $BTC at $64.7K, it’s more expensive to mine $BTC for smaller players.
Worse still, in 2026, the miner distress has extended for 250 days and counting. According to Edwards, this was 3x longer than the 2022 bear market (91 days) or 2018 (63 days). He added that the market situation was accelerating capital towards AI.
Bitcoin’s security is bleeding out. The current miner capitulation has been going for 3X longer. This is the result of every single public Bitcoin miner pivoting to AI.
As miners shift focus to AI, the drop in hash rate means a higher risk of the 51% attack. But the downturn can be viewed as historical patterns associated with bear markets.
But there’s a contrarian take.
Last month, MARA CEO Fred Thiel warned that low transaction fees revenue was Bitcoin’s ‘fundamental challenge’ after it failed to become a payment. According to him, Bitcoin mining will be tough after 2028’s halving cycle, slashing rewards from 3.125 $BTC to 1.5625 $BTC.
Besides, upcoming quantum risks and Bitcoin’s slow response to upgrades mean another round of security FUD could dent market sentiment.
Overall, $BTC is facing a double security threat from AI and quantum computer advancements. Whether these will devalue it further in the long term remains unclear.
Final Summary
- $BTC miner distress has been 3x longer in 2026 compared to historical patterns
- This has accelerated the AI pivot, which could increase security risk to the Bitcoin network
