Bitcoin (BTC) mining saw an uptick in profitability in June, surpassing May’s figures, driven by a 2% rise in cryptocurrency prices and a 5% decline in network hashrate as the market acclimated to the halving’s repercussions, according to a Jefferies research report released on Monday.

“June marked a period of moderate recuperation from the halving’s immediate impacts, which were most evident in May,” analyst Jonathan Petersen articulated.

Hashrate, denoting the aggregate computational power deployed for mining and transaction processing on a proof-of-work blockchain, serves as a proxy for industry competition and mining difficulty. The quadrennial reward halving, executed in April, decelerated the expansion rate of bitcoin supply by slashing miners’ rewards by 50%.

Jefferies adjusted its price target for Marathon Digital (MARA), which holds a ‘hold’ rating, lowering it to $22 from $24. The bank also revised its price target for Argo Blockchain ADRs (ARBK) to $1.20 from $1.50 and its U.K.-traded shares (ARB) to 9.5p (12 cents) from 11.90p, while maintaining its ‘hold’ rating on the company. One ADR equates to 10 shares.

The bank observed that several bitcoin miners have pivoted towards high-performance computing (HPC) and artificial intelligence (AI) hosting to diversify revenue streams and leverage the burgeoning demand for AI and cloud computing infrastructure.

“This strategic pivot has been necessitated by the diminishing profitability of bitcoin mining, particularly following the recent halving events,” Petersen noted.

U.S.-listed mining firms generated a larger proportion of new bitcoins in June compared to May, increasing to 20.8% of the total network from 19.1% the previous month as they expanded capacity and the network hashrate decreased.

Marathon mined the most bitcoins in June, totaling 590, although this was 4% fewer than in May. CleanSpark (CLSK) mined 445 tokens, marking a 7% increase, the report indicated. Marathon’s installed hashrate remained the largest among U.S.-listed miners, at 31.5 exahashes per second (EH/S), with Riot Platforms (RIOT) second at 22 EH/S, the report added.