© Reuters.
Investing.com – A coin halving event, scheduled for April, will have a negative impact on miners’ profitability due to lower rewards and higher production costs and could ultimately mean lower cryptocurrency prices, JPMorgan said in a February 28 research report. .
The bank notes that the cost of producing Bitcoin has historically served as a floor for Bitcoin prices, and says this could fall to 42,000 after the halving.
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The center point of the bank’s estimated cost of production range is currently around US$26,500, which will mechanically double to US$53,000 after the halving. The Bitcoin network could also see a 20% drop in its hash rate after the halving, which would reduce Bitcoin’s estimated production cost and price to $42,000, the report said.
“This $42,000 estimate is also the level we envision Bitcoin prices will drift towards once the euphoria from the post-April Bitcoin halving subsides,” analysts led by Nikolaos Panigirtzoglou wrote.
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Meanwhile, Bitcoin is now down about 0.8% in the last 24 hours to $62,115. While it fell by 1.5% to $3423.
This has implications for high-cost miners, the bank said. “Bitcoin miners with below-average electricity costs and more efficient platforms will likely be able to survive while those with high production costs will suffer.”
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2024-03-01 09:20:00
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