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Bitcoin (BTC) mining is becoming one of the toughest businesses in crypto in 2026.
What was once seen as a highly profitable way to earn has increasingly turned into a constant stress test for operators across the industry.
A combination of forces is squeezing miners from multiple directions. Bitcoin halving events are forcing companies to operate with thinner margins. At the same time, there are questions about the long-term sustainability of mining business models.
Then there is the rapid rise of artificial intelligence infrastructure and hyperscale data centers.
But miners now have another challenge to the list: geopolitics.
Global conflicts and political decisions are increasingly shaping financial markets, and Bitcoin is no longer immune to the ripple effects.
For miners, that creates a new layer of uncertainty.
A sudden escalation in conflict, sanctions, or disruptions to global trade can rapidly move Bitcoin price up or down. Because mining profitability is tightly linked to Bitcoin’s price, those shocks can directly affect revenue.
Related: What is Bitcoin mining? Explained
New analysis from Luxor Technology’s Hashrate Index suggests the ripple effects of the ongoing war involving the United States, Israel, and Iran, particularly disruptions to oil flows through the Strait of Hormuz, could put pressure on miners. This is primarily through Bitcoin’s price volatility rather than rising power costs.
The research examined how coordinated strikes by the U.S. and Israel on Iranian targets could impact global markets.
Following the disruption, WTI crude surged from roughly $65 per barrel to above $100 before easing to about $90. Roughly 20% of the world’s oil supply typically flows through the Strait of Hormuz, making the waterway one of the most important chokepoints in global energy markets.
At press time, a barrel of WTI crude oil stood at $95 after a 5% rally in the past week.
The spike in crude prices also drove trading activity in decentralized derivatives markets. Platforms such as Hyperliquid are seeing increased use as traders want to speculate on oil price movements outside traditional trading hours.
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According to data from the Cambridge Centre for Alternative Finance and the Bitcoin Mining Council, more than half of the Bitcoin network operates using non-fossil energy sources.
Hashrate Index analysts say crude oil itself is “essentially a rounding error” in the energy mix that powers global mining operations.
Instead, most miners draw electricity from grids dominated by natural gas, coal, hydroelectric or geothermal energy. As a result, the research estimates that about 90% of global hashrate operates in electricity markets where power prices have minimal correlation with crude oil.
The largest shares of global hashrate are concentrated in the United States, Russia and China. Other major mining hubs include Paraguay, the United Arab Emirates, Oman, Canada, Ethiopia and Kazakhstan, many of which rely heavily on hydroelectric or natural gas generation.
Only a small portion of the network appears directly exposed to oil-linked electricity markets. The Gulf states, including the United Arab Emirates and Oman, account for about 6% of global hashrate in power systems where electricity pricing tracks crude more closely.
Including exposure from Iran, Kuwait, Qatar and Libya raises the crude-sensitive portion of the network to roughly 8%–10%, according to the analysis.
So if oil is not directly affecting Bitcoin mining, then what might be the worry?
Analysts have explained that the real danger is not electricity costs, but how geopolitical shocks influence global macroeconomic conditions.
Higher oil prices can push inflation expectations upward and change interest rate outlooks. This potentially drives investors toward safer assets and away from volatile assets such as Bitcoin.
In fact, at the start of the war, Bitcoin fell by 6.4% in 24 hours. From the range of $67,000 before the war, Bitcoin dropped to as low as $63,176 on Feb 28. However, it did break past the $70,000 mark, that too multiple times before settling in the range of $64,000 and $69,000.
That shift can compress hashprice, the key metric measuring revenue earned per unit of computing power.
Hashrate Index data shows this dynamic already playing out earlier this year. Hashprice fell to an all-time low of $27.89 per PH/s/day in February after bitcoin dropped 23.8%, sliding from around $78,000 to $65,000.
Miners that hedged their exposure performed noticeably better. Over the past year, operations using rolling USD-denominated hash rate forward contracts outperformed spot mining by as much as 8.2%, the analysis found.
At press time, Bitcoin had climbed by 4.3% overnight to trade at $73,108.87.
