Analysts at Cantor Fitzgerald, a financial services firm, suggest that Bitcoin miners, including major players like Marathon Digital, Riot Platforms, and Core Scientific, may face challenges in maintaining profitability after the upcoming Bitcoin halving. CleanSpark's executive chairman and co-founder, Matthew Shultz, shared Cantor Fitzgerald's research on X (formerly Twitter), emphasizing that miners might struggle if the price of Bitcoin does not experience a significant rise post-halving. The revenue of Bitcoin miners is closely tied to the cryptocurrency's price, but some miners utilize strategies to hedge against potential losses due to price fluctuations.
According to Cantor Fitzgerald's analysis, Argo Blockchain and Hut 8 are considered the most likely to be unprofitable after the halving, given the current Bitcoin prices. These companies have estimated "total" per-coin costs of $62,276 and $60,360, respectively. However, Hut 8 recently reported a significant reserve of 9,195 BTC, valued at $377 million at current prices, in its mining operations update on January 5.
Cantor analysts project that companies capable of maintaining profitability post-halving, assuming an average Bitcoin price of $40,000 and no drastic changes in hashrate, include Singaporean miner Bitdeer and U.S.-based mining company CleanSpark. The "Total Cost Per Bitcoin" metric used by Cantor refers to the overall cost incurred by Bitcoin miners to produce a single Bitcoin, encompassing electricity, custody fees, and other cash expenses.
The Bitcoin halving, scheduled for April, involves a reduction in mining rewards for Bitcoin miners. While some experts believe that reduced supply is positive for Bitcoin's long-term price, it presents a challenge for miners with high operating costs. If the Bitcoin price does not reach a level that covers these costs, profitability concerns may escalate. Market observers often anticipate a significant rise in Bitcoin prices in the months following the halving, and miners employ various strategies, such as buying derivatives products like hashrate futures contracts and Bitcoin-related options, to mitigate BTC risk.
