Is a historic difficulty adjustment too little too late? Bitcoin miners are facing production costs that exceed revenue, with hash rate and stock prices both under pressure.

February 11, 2026, marks the coldest moment for Bitcoin mining since the FTX collapse.

According to Gate market data, BTC/USDT is currently priced at $66,680.4, down 3% over the past 24 hours. Behind this figure is a crushing set of production books: the average fully diluted cost to produce one Bitcoin across the network is approximately $87,000, about 45% higher than the current market price.

This is the first widespread, systemic “underwater operation” in Bitcoin mining since the 2022 bear market. On-chain data analysis firm CryptoQuant clearly defines this stage as the “Capitulation Phase.”

Inverted Books: Losing $20,000 per BTC Mined

Rewind to October 2025, when Bitcoin hit a record high of $126,000. At that time, miners were in high demand, with the entire network’s hash rate rushing in. However, four months later, the price retraced more than 50% from its peak, hovering around $60,000.

While the price was halved, costs continued to rise rigidly. As Bitcoin network difficulty and hash rate difficulty base accumulated in 2026, and older mining machines’ efficiency declined, the network’s average fully diluted production cost per Bitcoin has climbed to approximately $87,000.

This means that even without considering site operation and personnel costs, miners are effectively losing nearly $20,000 on each Bitcoin mined on paper. Such a cash flow inversion is no longer a gap that fine-tuned operations can fill.

The industry’s key indicator—the “Miner Profitability Sustainability Index”—has fallen to 21. This metric’s interpretation is brutally clear: apart from a few top players with ultra-low electricity costs below $0.05 per kWh and equipped with the latest energy-efficient models, most miners’ profit margins have been completely squeezed into negative territory.

Hash Rate Retreat: 11% Difficulty Adjustment Cannot Halt Shutdown Wave

The most direct consequence of miners capitulating is a significant decline in total network hash rate.

Coupled with rare severe cold storms in North American mining hubs (especially Texas), some mining farms have been forced to limit power to ensure civilian load. Under the dual pressure of voluntary shutdowns and forced curtailments, the network triggered a historic difficulty adjustment on February 9, reducing difficulty by about 11%.

However, this is a “belated and insufficient” painkiller. While an 11% difficulty reduction can somewhat lower the mining threshold, compared to the 45% price-cost inversion rate, this correction is like a drop in the bucket.

For mid-tier farms with electricity prices above $0.05 per kWh or companies still using older models like the S19 series, this difficulty adjustment is nowhere near enough to reverse the risk of full shutdown. The hash rate market is still in the process of clearing.

Mining Stocks Plunge Over 20%, Capital Fleeing Risk

Wall Street’s capital intuition is even more sensitive than difficulty adjustments.

Affected by deteriorating mining fundamentals and persistent downward pressure on Bitcoin prices, US-listed mining companies have faced a broad sell-off this week. Leading miners like MARA Holdings and Riot Platforms saw stock declines exceeding 20%.

Take MARA as an example: its stock has sharply retreated from its 2025 high, closing at $7.66, with a price-to-book ratio (P/B) dropping to 0.56, reflecting extreme market pessimism about the “pure mining” business model.

Capital flows clearly indicate a risk-averse attitude: large amounts of funds are fleeing volatile crypto assets and flowing back into safer traditional assets like gold.

From “Miner” to “AI Computing Power Landlord”

Faced with what industry insiders call the “2026 Mining Winter,” top companies are not waiting for a price rebound. A large-scale “AI transformation” strategy is accelerating within the mining sector.

The logic is simple: mining farms are essentially large-scale, low-latency data centers with existing power capacity, cooling systems, and rack space. These resources are costly burdens during Bitcoin bear markets but are scarce assets in the era of generative AI and high-performance computing (HPC) demand.

Companies like IREN and Core Scientific have already shifted some data center power capacity to support generative AI businesses, securing stable cash flows through long-term contracts far above mining revenues.

Bitfarms has made the most thorough transformation. The company recently announced it will fully exit Bitcoin mining and focus entirely on AI. Once one of the largest pure-mining players, it is now shedding its “Bitcoin” label.

Another miner, Cango, completed the sale of 4,451 BTC on February 9, raising approximately $305 million at an average price of about $68,524 per BTC, all to fund its AI infrastructure transition. In a letter to shareholders, it stated this move aims to “strengthen the balance sheet and reduce financial leverage” to support strategic expansion into GPU computing services.

Summary

Bitcoin mining is experiencing a delayed but exceptionally thorough supply-side clearing.

In the short term, unless Bitcoin’s price quickly rebounds and stabilizes above $80,000, the “production loss” situation will continue to force high-cost miners out. Although a historic difficulty adjustment has provided a brief respite for survivors, the “Capitulation Phase” in mining is unlikely to end before macro liquidity and risk appetite shift again.

However, in the long run, hash rate has not disappeared—it is merely transforming. Companies that successfully convert power licenses and rack resources into AI computing services will be reborn in the next technological cycle.

For Bitcoin believers still holding on, the figures on the Gate quote page are both a test and a measure—they mark the darkest moment of this cycle and also serve as the entry point for survivors.