Bitcoin miners languish amid crypto market rout — JPMorgan

Bitcoin (BTC) mining stocks are struggling arsenic declining cryptocurrency prices adhd further unit to concern models strained by the Bitcoin network’s April halving, according to a JPMorgan probe enactment shared with Cointelegraph. 

Mining stocks tracked by JPMorgan collectively shed 22% successful marketplace capitalization successful February arsenic Bitcoin’s falling terms eroded mining economics, the March 3 study said. 

Mining stocks specified arsenic Riot Platforms (RIOT), Bitdeer (BTDR), Marathon Digital (MARA) and Core Scientific (CORZ) reported their fourth-quarter 2024 net successful February.

Virtually each of them saw post-earnings banal terms declines, including Core Scientific, which reported better-than-expected Q4 revenues.

Bitcoin’s terms versus the network’s hashrate. Source: JPMorgan

Related: Analysts oculus Bitcoin miners’ AI, spot income up of Q4 earnings

Halving woes

Every 4 years, the fig of BTC mined per “block” — a bundle of transaction information stored connected the blockchain — is reduced by half. The April halving lawsuit reduced mining rewards from 6.25 BTC to 3.125 BTC per block.

Since the halving, mining revenues and gross profits person dropped by an mean of 46% and 57%, respectively, JPMorgan said. 

Meanwhile, little Bitcoin prices contributed to a 9% driblet successful gross profits successful February, the analysts said. 

Macroeconomic uncertainty — including fears of a looming commercialized warfare — has rattled markets since US President Donald Trump took bureau successful January and announced 25% tariffs connected Canada and Mexico.

Pressure connected AI businesses

Miners are optimistic that adjacent concern lines — including leasing retired high-performance hardware to AI models and selling specialized ASIC microchips — volition much than offset immoderate gross losses.

But adjacent miners cashing successful connected request for high-performance computing (HPC) from artificial quality models are nether strain, JPMorgan noted. 

“Operators with HPC vulnerability besides felt unit pursuing the DeepSeek announcement and questions astir near-term request for information halfway capacity,” the analysts said. 

In January, AI-related stocks took a deed erstwhile the Chinese AI institution Deepseek claimed its AI models were capable to nutrient results comparable to US marketplace leaders specified arsenic OpenAI’s ChatGPT for a fraction of the cost. 

Despite the setback, mining stocks with extended AI exposure, specified arsenic Hut 8, are inactive much richly valued than peers, JPMorgan said.

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