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- 1 JPMorgan, a financial service firm, forecasted a potential 20% drop in Bitcoin hash rate in April 2024.
- 2 Bitcoin’s fourth halving is expected to affect the Bitcoin mining industry, mainly the Bitcoin miner’s rewards.
A report released by JPMorgan shocked the crypto world, mainly the individuals linked with one of the oldest cryptocurrencies, Bitcoin. The report forecasts a huge decline of 20% in Bitcoin hash rate in April 2024 amid Bitcoin halving.
Why is JPMorgan So Sure About the Drop?
JPMorgan Chase is an American multinational financial service provider, serving millions of customers in more than 100+ global markets. As a leader in wholesale financial services, it’s the duty of JPMorgan to keep an eye on current ups and downs in the financial market as well as for upcoming disasters and growth opportunities.
As a part of business, JPMorgan examines the current trends in blockchain technology, digital currencies, digital marketing, and the Bitcoin market.
In a recent report release, JPMorgan forecasted a huge decline in Bitcoin hash rate by 20% in April 2024. The decline is expected to take place post the Bitcoin halving and is expected to affect the miners.
“80 EH/s (20% of the network hash rate) is assumed to be removed at the next halving due to less efficient hardware”, the report states.
Bitcoin halving is simply an event where rewards for mining new blocks are halved. The miners are rewarded with a certain amount of Bitcoin during the event. The event occurs every four years and is next scheduled for April 2024. The upcoming Bitcoin halving event is expected to influence the Bitcoin mining industry, mainly the miners.
Based on the report, Bitcoin mining involved a reduction in Bitcoin miners’ rewards by half as it aims to mitigate the issue of inflation.
Bitcoin’s current price is $26,778 representing a four-year block reward opportunity that totals $20 Billion. However, it involves a substantial decline of around 72% from about two years ago.
Who is on the Hit List?
Apart from the prediction, JPMorgan also listed some of the top miners offering the best values mainly in terms of operational efficiency, current hash rate, funded growth plans, liquidity, and power contracts.
CleanSpark (CLSK), Riot (RIOT), and Cipher Mining (CIFR) are JPMorgan’s top picks offering the best values.
CleanSpark provides the best balance of growth potential, scale, value, and power costs. Marathon Digital (MARA), on the other hand, failed to secure the top ranking due to its high energy cost and low margins.
Similarly, Riot has low power costs and liquidity but is listed as one of the most expensive stocks.
Additionally, Bitcoin miners are continuously looking for options to safeguard their revenues amid the high volatility of the cryptocurrency marketplace.
Conclusion
The prediction of JPMorgan for Bitcoin halving and Bitcoin hash rate decline created a depressing situation for Bitcoin miners. The report released by the financial firm forecasts a potential 20% decline in Bitcoin hash rate in April 2024.
Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.
