Bitcoin (BTC) miners are gearing up for the impending reward halving as analysts project a resurgence in the cryptocurrency’s value with forecasts reaching as high as $150,000 by 2025. Despite underperformance earlier this year, mining executives remain optimistic, citing favorable financial positions and strategic preparations.
As highlighted by research and brokerage firm Bernstein, the current underperformance of miners can be attributed to the robust movements in spot bitcoin and exchange-traded funds (ETFs). Gautam Chhugani and Mahika Sapra, analysts at Bernstein, emphasized concerns about the impending halving’s impact on miner revenues, particularly with the reduction in rewards slowing the rate of bitcoin supply growth.
In interviews conducted by Bernstein, CEOs of prominent mining firms including Riot Platforms (RIOT), CleanSpark (CLSK), Marathon Digital (MARA), Cipher Mining (CIFR), and Hut 8 (HUT) expressed confidence in their financial resilience leading up to the halving. With miner dollar revenues at all-time highs and minimal debt on balance sheets, these companies are positioned to weather the halving’s effects.
Furthermore, industry leaders anticipate a wave of consolidation among mining firms, with CleanSpark’s CEO projecting the emergence of four dominant players, including RIOT, MARA, CLSK, and CIFR. Marathon Digital’s CEO also envisions consolidation, identifying CleanSpark as a primary competitor for acquisition targets.
A notable shift in this cycle is the emphasis on application and layer 2 development on the Bitcoin blockchain, leading to increased network fees that bolster miners’ revenue streams. Riot and CleanSpark are poised to double their capacity by year-end, mitigating any potential adverse effects of the halving.
Analysts at Bernstein maintain a bullish outlook on Bitcoin, foreseeing a resurgence post-halving as mining hash rates adjust and ETF inflows regain momentum. Integration of spot bitcoin ETFs with major wirehouses and RIAs is expected to sustain structural demand for bitcoin, contributing to its upward trajectory.
