Crypto News- JPMorgan Predicts: In a recent report, has unveiled a forecast of a potential 20% decline in Bitcoin’s Network Hash Rate, and this forecast is tied to the upcoming Bitcoin halving event scheduled for April 2024. According to the report, this decrease in hash rate, equivalent to approximately 80 EH/s or 20% of the network’s total hash power, is expected as less efficient mining hardware is gradually phased out.
JPMorgan Predicts a 20% Decrease in Bitcoin’s Hash Rate by April 2024
The report characterizes the Bitcoin mining sector as being at a critical crossroads as the next Bitcoin halving, slated for April 2024, draws near. The halving, which occurs every four years, entails a halving of Bitcoin miners’ rewards and serves the purpose of controlling inflation.
The report also underscores the significance of the current state of affairs, noting that, at Bitcoin’s current price, the total block reward over a four-year cycle amounts to approximately $20 billion. Interestingly, this represents a substantial decrease of roughly 72% from just over two years ago when it reached its peak of around $73 billion in April 2021. Over the past year, it has fluctuated between $14 billion and $25 billion.
At the time of the report, Bitcoin’s price was $26,778. JPMorgan also provides insight into various Bitcoin mining companies, singling out CleanSpark as their preferred choice:
“We believe CLSK, our top pick, offers the best balance of scale, growth potential, power costs, and relative value.”
Despite being the largest operator, Marathon Digital is perceived to have the highest energy costs and the slimmest profit margins, according to the investment firm.
Speculations Surrounding Bitcoin Mining Pre-Halving
Marathon Digital offers rough estimates of its operational capabilities on its website, asserting that it currently has approximately 155,910 operational miners worldwide. In addition, the company views Riot Platforms as having relatively low power costs and strong liquidity.
However, it’s essential to note that recent online discussions have raised questions about the conventional belief that Bitcoin’s four-year cycles are intrinsically tied to its halving events.
Citing these discussions, a Bitcoin enthusiast by the name of ‘Pledditor’ challenges the prevailing narrative:
“Bitcoin’s four-year cycles are merely coincidental and have little to do with the halvings.”
Nonetheless, the approaching halving event continues to spark enthusiasm within the Bitcoin mining industry. As previously reported on August 16, the Bitcoin infrastructure company Blockstream has been procuring Bitcoin mining rigs in anticipation of these assets appreciating in value after the April 2024 halving.
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