Bitcoin’s value dropped below $90,000 for the first time since April, reaching an intraday low of $89,426 before settling around $91,200. This decline marks a significant retreat of more than 20% from its October peak, which exceeded $126,000, effectively erasing all gains made in 2025.
Market dynamics have played a crucial role in this downturn, with $2.3 billion in outflows from U.S. spot Bitcoin ETFs in early November contributing to the sell-off. Additionally, rising Treasury yields have created an unfavorable environment for cryptocurrencies. However, supply-side pressures originating from Bitcoin miners themselves have further exacerbated the situation. Increased electricity costs, partly due to the rapid expansion of artificial intelligence data centers, have put a strain on mining profitability, forcing operators to liquidate their holdings.
Electricity expenses comprise 70% to 80% of Bitcoin mining costs. The halving event in April 2024 reduced the block reward to 3.125 BTC, and even when prices hovered above $100,000 earlier in the year, many miners operated on tight margins. Since then, wholesale power prices in key mining areas have surged. For example, in Texas, which hosts the largest U.S. mining operations, average wholesale prices rose 18% year-over-year in the third quarter of 2025. Similarly, in Northern Virginia, prices increased by 13% during this period.
Looking forward, the U.S. Energy Information Administration projects national wholesale power prices to rise 8.5% in 2026, driven primarily by demand from data centers. AI workloads are expected to double U.S. data-center power consumption, increasing from approximately 200 terawatt-hours in 2024 to over 400 terawatt-hours by 2030.
In the first half of November, on-chain analytics indicated that miners offloaded around 71,000 BTC to exchanges, which followed a significant transfer of 210,000 BTC in October. This trend represents one of the highest monthly totals since the bear market of 2022.
Publicly traded mining companies are adapting to these pressures. Marathon Digital, for instance, confirmed it sold parts of its October and November production to meet operating costs. Meanwhile, Core Scientific and Iris Energy have entered multi-year contracts for AI workloads, which offer revenue premiums of 3-4 times their Bitcoin mining income. Furthermore, Bitfarms announced plans to exit crypto mining by 2027, intending to repurpose its energy portfolio for high-performance computing.
This strategic pivot appears financially sound, with AI hosting contracts generally yielding EBITDA margins of 70% to 80% and offering more stable revenue than Bitcoin mining. However, the immediate impact on the Bitcoin market is clear: more coins are flooding into exchanges as retail and institutional demand weakens.
Analysts from Bernstein highlighted that the current market combines elements of post-halving margin compression with increased competition for grid capacity. They estimate that the break-even power costs for the median public miner stand between $65,000 and $70,000 per Bitcoin, leaving little leeway for price fluctuations if values remain in the low $90,000 range.
Despite the challenges, not all miners are capitulating. Some operations utilizing stranded or renewable energy sources at low rates, particularly in Canada, Scandinavia, and parts of Latin America, continue to accumulate Bitcoin profitably. Currently, around 52% of the global hash rate operates on renewable energy, according to the Cambridge Centre for Alternative Finance.
In the short term, the increased supply from miners has played a significant role in pushing Bitcoin prices below the psychological threshold of $90,000. While long-term projections remain mixed, some financial analysts continue to predict year-end targets above $100,000, fueled by the expectation of renewed institutional inflows. However, for now, growing electricity demand presents ongoing challenges for the cryptocurrency market.
