Key Points
- Bitcoin’s bullish trajectory in 2024 is attributed to ETFs and its 4th halving.
- Despite challenges, many mining firms remain profitable and ready for short-term profitability challenges.
In 2024, Bitcoin (BTC) has shown remarkable resilience, bolstered by the introduction of ETFs and its 4th halving. Additionally, there has been a noticeable shift in the behavior of miners.
CryptoQuant’s research indicates that miners have been dispatching roughly 374 BTC to spot exchanges each day over the previous month. This figure is significantly lower than the daily average seen in February.
Bitcoin Halving and Miner Profitability
Contrary to popular belief, the halving of Bitcoin is not necessarily a catastrophic event for miners. Adam Sullivan, CEO of Core Scientific, asserts that with Bitcoin’s price above $60,000, almost no machines will be shut down. Even during the halving, many will remain profitable. This suggests that numerous mining companies are financially sound and prepared to weather short-term profitability challenges.
However, smaller, less efficient miners may struggle after the halving, potentially leading to industry consolidation. Mark Yusko, Founder of Morgan Creek Capital Management, believes the halving event could result in a significant supply shock, which is currently underestimated.
Halving Event and Market Reaction
Dan Dolev, Managing Director at Mizuho Securities, predicts a “sell-the-news” response to the halving event. This view was quickly dismissed by @BobLoukas, who claimed that the halving is not priced in.
Despite skepticism prior to its halving, Bitcoin demonstrated strong buying pressure after the event, evidenced by a 3.26% price increase. David Alderman, a Digital Asset Research Analyst at Franklin Templeton, noted that as the price rises, so does market noise.
Interestingly, Bitcoin has stuck to its historical trends and experienced a surge following the halving event, despite ongoing geopolitical tensions.
