Markets
Bitcoin mining profitability increased in June as market adjusted for halving: Jefferies
Bitcoin (BTC) Mining was more profitable in June than in May as the cryptocurrency’s price rose 2% and the network’s hash rate fell 5%, and the market adjusted to the effects of the halving, investment bank Jefferies said in a research report released Monday.
“June was a month of modest recovery after the immediate impacts of the halving were most pronounced in May,” wrote analyst Jonathan Petersen.
Hash Rate refers to the total combined computing power used to mine and process transactions on a proof of work blockchain and is an indicator of industry competition and mining difficulty. halving the rewardwhich occurred in April, slowed the growth rate of bitcoin supply, with miners’ rewards being reduced by 50%.
Jefferies cut its price target on Marathon Digital (MARA) to $22 from $24. The bank also cut its price target on Argo Blockchain ADRs (ARBK) from $1.50 to $1.20 and on the UK-traded shares (ARB) from 11.90 pence to 9.5 pence (12 cents). It maintained its hold rating on the company. One ADR is equal to 10 shares.
The bank noted that a number of bitcoin miners have turned to high-performance computing (HPC) and artificial intelligence (AI) hosting to diversify their revenues and capitalize on growing demand for AI and cloud computing infrastructure.
“This strategic shift was driven by the declining profitability of bitcoin mining, particularly after recent halving events,” Petersen wrote.
U.S.-listed miners produced a larger share of new bitcoins in June than in May, the bank said, rising to 20.8% of the total network from 19.1% the previous month, as they brought in new capacity and the network’s hash rate fell.
Marathon was the top miner to mine bitcoin in June, with 590, down 4% from May. CleanSpark (CLSK) mined 445 coins, up 7%, according to the report. Marathon’s installed hash rate remained the highest among publicly traded U.S. miners, at 31.5 exahashes per second (EH/s), followed by Riot Platforms (RIOT) with 22 EH/s, the report added.