Coin mining was more profitable in June and the market adjusted for the halving effect

        According to the report, U.S.-listed mining companies increased their bitcoin production in June compared to May, and as they introduced new capacity, the network hash rate declined.

        According to a research note published by investment bank Jefferies on Monday, Bitcoin (BTC) mining profits were higher in June than in May, due to a 2% increase in the price of the cryptocurrency, a 5% decline in the network hash rate, and the market adjusting to the halving effect.

      "June was a modest month of recovery from the immediate impact of the most obvious halving in May," analyst Jonathan Petersen wrote.

The hash rate refers to the total computing power used to mine and process transactions on the proof-of-work blockchain and is an indicator of competition and mining difficulty in the industry. The quadrennial reward halving took place in April, and the growth rate of Bitcoin supply slowed as the reward for miners was reduced by 50%.

Jefferies cut its price target on Marathon Digital (MARA) with a hold rating to $22 from $24. The bank also cut its price target for Argo Blockchain ADRs (ARBK) to $1.20 from $1.50 and its UK-traded shares (ARB) to 9.5 pence (12 cents) from 11.90 pence. It maintained its hold rating on the company. One ADR is equivalent to 10 shares.

The bank noted that many bitcoin miners have turned to high-performance computing (HPC) and artificial intelligence (AI) hosting to diversify their revenues and take advantage of surging demand for AI and cloud computing infrastructure.

"This shift in strategy is due to the decline in profits from Bitcoin mining, especially after the recent halving event," Petersen wrote.

The bank said U.S.-listed mining companies increased new bitcoin production in June from May to 20.8 percent of the total network from 19.1 percent, as they introduced new capacity and the network hash rate declined.

Marathon had the highest number of mines in June with 590, down 4% from May. CleanSpark (CLSK) mined 445 tokens, an increase of 7%. Marathon continues to have the largest installed hash rate among listed US miners at 31.5 exahashes per second (EH/S), while Riot Platforms (RIOT) is close behind at 22 EH/s.