Miners are better positioned for this halving due to the large gains in bitcoin in the last six months, the report said.01:27NSC Director: Biden Administration Hasn’t Determined Holistic Policy Approach to Virtual Currency, and they are better positioned this time round due to the cryptocurrency's gains in the past six months, broker Benchmark said in a research report on Thursday.
Given bitcoin’s recent outperformance, the “role of the halving in driving the retirement of inefficient mining rigs and reducing the network“Most of the publicly traded bitcoin miners have initiated or announced plans to increase their electricity and hashrate capacities as a means of adjusting to their reduced revenue and gross profit profiles,” Benchmark analyst Mark Palmer wrote, noting that due to uncertainty around the halving nearly all of the listed miners’ stocks are down year-to-date...
“The impact of the halving on bitcoin miners’ economics could be more offset over time if history repeats and a strong rally in the price of the cryptocurrency occurs during the months following the event,” Palmer wrote. The broker noted that a potential increase in network fees could also help to mitigate the impact of reduced block rewards.
The halving’s effect on the cryptocurrency’s price “could be magnified by the concurrent demand shock created by the emergence of spot bitcoin exchange-traded funds following their approval in the U.S. in January,” the report said. “We expect the inflows into spot bitcoin ETFs to grow dramatically once institutions begin to invest in them in earnest.”in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin.