Bitcoin (BTC) mining stocks are slow. In addition to the effects of being half in April, the decline in cryptocurrency prices has also led to further pressure on the business model, JP Morgan identified in a research note jointly with the Quantile Graph.
According to a report by JP Morgan on March 3, the market capitalization of the tracked mining stock in February fell 22 %. Bitcoin prices have affected mining revenue.
Mining companies such as the riot platform (riots), Bitdia (BTDR), Marathon Digital (Mara) and Core Scientific (Cars) announced the financial results of their fourth quarter 2024 in February.
Even the basic scientific, which reported the fourth quarter’s income, which exceeded expectations, almost all companies fall into stock prices after revenue announcements.
Bitcoin price compared to network hashtag. Source: JP Morgan
The effect of half -life
Bitcoin mining prizes every four years (a bundle of transactional data stored on blockchain). In half of this April, mining prizes have dropped from 6.25 BTC to 3.125 BTC.
According to JP Morgan, after half a life, mining revenue and overall profits declined by an average of 46 % and 57 % respectively.
In addition, analysts said that the drop in bitcoin prices also saw a 9 % decline in the total profit in February.
The economic uncertainty is also shaking the market. Ever since US President Donald Trump announced 25 % of taxes on Canada and Mexico in January, the trade war concerns have spread extensively.
Impact on AI business
Minor companies are hoping to counter revenue reduction with new businesses, such as lending to high -performance hardware for AI models and selling special ASIC microchips.
However, JP Morgan noted that even mining companies working on the high -performance computing (HPC) business for AI are also under market pressure.
“Following the announcement of a DPC, after the doubts about the outlook of the Data Center demand, the HPC -related business is also under pressure from our operators,” said analysts said.
In January, AI -related stocks fell when the Chinese AI company Dipisic claimed that its AI model could compare the results like US market leaders such as Openi’s chat GPT at a very low cost.
Yet, JP Morgan said, yet, the stock of mining companies, which is very involved in the AI business such as Hat -8, is still ranked high by his colleagues.
