Only 2 Out of 13 Bitcoin Miners Predicted to Stay Profitable After Halving

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Bitcoin Halving Threatens Profitability for 11 Major Miners
  • Financial firm Cantor Fitzgerald warns that 11 major publicly traded Bitcoin miners will not be profitable post-BTC halving event.
  • Argo Blockchain and Hut 8 Mining are projected to face high post-halving costs, exceeding $60,000 per Bitcoin.
  • Bitdeer and CleanSpark are forecasted as the only profitable miners, at $17,774 and $36,896 per Bitcoin, respectively.

Eleven of the largest publicly traded Bitcoin miners could face serious profitability challenges after the upcoming halving event, a new report from financial firm Cantor Fitzgerald warns.

Scheduled to occur in April 2024, the halving will reduce the reward for miners by 50%, a mechanism designed to maintain scarcity in Bitcoin’s supply. While this event is often viewed as bullish for Bitcoin’s long-term price, it also presents immediate challenges for miners with high operating costs.

Cantor’s analysis, cited by CleanSpark’s Executive Chairman S. Matthew Shultz, paints a stark picture. Their estimated “all-in” cost-per-coin, encompassing expenses like electricity, maintenance, and personnel to produce a single Bitcoin, reveals that only two of the 13 largest publicly traded miners are likely to remain profitable post-halving. This is in the assumption that there is no immediate change in operations or network hash and a Bitcoin price not below $40,000.

The report identifies Argo Blockchain (ARBK) and Hut 8 Mining (HUT) as particularly vulnerable, with a projected post-halving “all-in” cost-per-coin rate exceeding $60,000. Even industry giants like Marathon Digital (MARA) and Riot Blockchain (RIOT), boasting market capitalizations of $3.62 billion and $2.19 billion respectively, are predicted to face profitability hurdles, with estimated “all-in” cost-per-Bitcoin rates of $50,559 and $43,913, respectively.

Hope glimmers for Bitdeer (BTDR) and CleanSpark (CLSK), the only two miners forecasted to stay profitable. BTDR emerges as the most efficient, with an “all-in” cost of $17,774 per Bitcoin, followed by CleanSpark at $36,896.

In 2022, Bitcoin mining experienced a severe bear market, with the coin dropping below $16,000 in late November, its lowest point in over two years. However, it has since rebounded, briefly trading above $46,000 in January 2024 after the launch of the first spot Bitcoin ETF.

Currently, Bitcoin (BTC) is at a critical point, with analysts closely watching its price. There is apprehension that a drop below $38,000 could trigger a further decline toward $33,000. As of now, BTC is trading at $39,933, reflecting a 3.52% decrease over the past week.

On January 15, a report warned that the upcoming Bitcoin halving in April could increase the average cost of mining one Bitcoin to $37,856. RIOT, TeraWulf (WULF), and CLSK were identified as the best-positioned miners to withstand this challenge due to their efficient cost structures.

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