In a report published on Thursday, JPMorgan predicts a 20% decline in the Bitcoin Network Hash Rate after the fourth Bitcoin halving, set for April 2024. This event, which occurs every four years, aims to control inflation by reducing miners' rewards by half.
Currently, based on Bitcoin's price of $26,778, the total block reward opportunity is estimated at $20 billion. This figure represents a significant drop from its peak of $73 billion in April 2021 and has fluctuated between $14 billion and $25 billion over the past year.
The upcoming halving event is seen as a "crucible moment" for the industry. Less-efficient hardware is expected to be decommissioned, which could lead to a reduction in the hash rate.
Among Bitcoin mining firms, JPMorgan identified CleanSpark as its top pick due to its balance of scale, growth potential, power costs, and relative value. Marathon Digital (NASDAQ:MARA), despite being the largest operator with approximately 155,910 miners worldwide, was noted for its highest energy costs and lowest margins. Riot Platforms received praise for its low power costs and liquidity.
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