NEWSLETTER
The mining actions of bitcoin (btc) are fighting since the decrease in cryptocurrency prices add more pressure to business models tensioned by the April network of the bitcoin network, according to a JPMorgan research note shared with Cointelegraph.
The mining shares tracked by JPMorgan collectively yield 22% in market capitalization in February as the mining economy eroded for the price of bitcoin, according to the March 3 report.
Mining stocks such as Riot Platforms (Riot), Bitdeer (BTDR), Digital Marathon (Mara) and Core Scientific (Corz) reported their profits from the fourth quarter of 2024 in February.
Virtually all saw decreases in the price of subsequent shares, including Core Scientific, which reported revenues from the fourth quarter better than expected.
The price of bitcoin versus the hashrate of the network. Source: JPMorgan
Related: Analysts hey bitcoin Miners' ai, Chips sales before the fourth quarter
Half the problems
Every four years, the btc number extracted by “blocking”, a transaction data package stored in the block chain, is reduced by half. The event of the middle of April reduced the mining rewards of 6.25 btc to 3,125 btc per block.
From half, mining income and gross profits have decreased by an average of 46% and 57%, respectively, said JPMorgan.
Meanwhile, bitcoin's lowest prices contributed to a 9% drop in gross profits in February, analysts said.
Macroeconomic uncertainty, including the fear of an imminent commercial war, has caused markets since the president of the United States, Donald Trump, assumed the position in January and announced 25% tariffs in Canada and Mexico.
Pressure on ai business
Miners are optimistic that adjacent commercial lines, including high -performance hardware lease to ai models and the sale of specialized ASIC microchips, will more than compensate any loss of income.
But even the miners charging the demand for high performance computing (HPC) of artificial intelligence models are under tension, JPMorgan said.
“HPC exposure operators also felt pressure after Depseek's announcement and questions about the short -term demand for the data center capacity,” analysts said.
In January, ai -related actions had a success when the Chinese ai Deepseek said that their ai models could produce results comparable to US market leaders such as OpenAi chatpt by a fraction of the cost.
Despite the reverse, mining stocks with an extensive exposure of ai, such as Hut 8, are still more valuable than their peers, Jpmorgan said.
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