Bitcoin Halving Could Make 9 Of 11 Largest Public Miners Unprofitable: Analyst
Portfolio Pulse from Khyathi Dalal
A Cantor Fitzgerald report suggests that the upcoming Bitcoin Halving in April could render nine of the eleven largest publicly traded Bitcoin miners unprofitable at a Bitcoin price of $40,000. Only Bitdeer (BTDR) and CleanSpark (CLSK) are expected to maintain profit margins. Argo Blockchain (ARBK) and Hut 8 Mining (HUT) are projected to be the most affected. Other miners like Marathon Digital (MARA), Riot Blockchain (RIOT), and Core Scientific (CORZ) may also face significant impacts. The report considers the all-in cost per coin, which includes electricity, hosting fees, and other expenses. Miners are selling reserves ahead of the Halving to cover costs and prepare for future investments. The Halving, which reduces the reward per block for miners, is expected to create price increases due to supply contraction.
January 26, 2024 | 5:16 pm
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POSITIVE IMPACT
Bitdeer is one of the two companies expected to maintain profit margins post-Bitcoin Halving, with a cost-per-coin rate of $17,774.
Bitdeer's ability to maintain profit margins despite the Halving suggests a positive outlook for the company's financial performance in the short term.
CONFIDENCE 75
IMPORTANCE 70
RELEVANCE 80
POSITIVE IMPACT
CleanSpark is projected to remain profitable after the Bitcoin Halving with a cost-per-coin rate of $36,896.
CleanSpark's continued profitability indicates a resilient business model, which could positively influence its stock price in the short term.
CONFIDENCE 75
IMPORTANCE 70
RELEVANCE 80
NEGATIVE IMPACT
Argo Blockchain faces a high 'all in' cost-per-coin rate of $62,276, which could significantly impact profitability post-Halving.
Argo Blockchain's high cost-per-coin rate compared to the current Bitcoin price suggests a negative impact on its short-term financial performance.
CONFIDENCE 80
IMPORTANCE 85
RELEVANCE 90
NEGATIVE IMPACT
Core Scientific is also expected to be significantly affected by the Bitcoin Halving, with high production costs.
Core Scientific's mention as likely to be impacted by the Halving suggests a negative short-term outlook for its financial performance and stock price.
CONFIDENCE 70
IMPORTANCE 75
RELEVANCE 70
NEGATIVE IMPACT
Hut 8 Mining's 'all in' cost-per-coin rate of $60,360 may lead to profitability challenges after the Bitcoin Halving.
The high cost-per-coin rate for Hut 8 Mining suggests potential financial strain following the Halving, likely affecting its stock price negatively.
CONFIDENCE 80
IMPORTANCE 85
RELEVANCE 90
NEGATIVE IMPACT
Marathon Digital is likely to be significantly impacted by the Bitcoin Halving due to the associated costs of mining.
Marathon Digital's inclusion in the report as likely to be impacted suggests a potential negative effect on its short-term earnings and stock price.
CONFIDENCE 70
IMPORTANCE 75
RELEVANCE 70
NEGATIVE IMPACT
Riot Blockchain is among the miners expected to face significant challenges to profitability due to the Halving.
Riot Blockchain's potential profitability issues post-Halving could negatively impact investor sentiment and its stock price in the short term.
CONFIDENCE 70
IMPORTANCE 75
RELEVANCE 70