As a seasoned crypto investor with a decade of experience under my belt, I must admit that the recent surge in share prices of Bitcoin miners has caught my attention. Having navigated through several market cycles, I can attest to the fact that such upward trends often signal promising opportunities.
As a researcher, I observed a significant surge in the share prices of Bitcoin miners on October 28, reaching as high as 24.4%. This upward trend followed Bitcoin’s rally above $70,000. An analyst attributed this growth to an improving macroeconomic environment and the persistent efforts by miners to diversify their operations into Artificial Intelligence (AI).
Increased deficit spending and reduced interest rates are leading to a rise in global financial resources. However, investors express concern about potential long-term inflation due to these factors, as indicated by the underperformance of treasury bonds since the September rate reduction. This perspective is shared by Mitchell Askew, chief analyst at Bitcoin mining company Blockware.
Consequently, investors are increasingly looking towards the Bitcoin market, as shares of Bitcoin mining companies are being traded with a “correlation factor.
Additionally, some Bitcoin miners are finding profit by expanding into areas like artificial intelligence (AI) and advanced computing systems, as pointed out by Askew.
On October 28th, Singapore-based Bitdeer Technologies (BTDR) saw the most significant growth with a 24.4% surge. Meanwhile, IREN (IREN), Gryphon Digital Mining (GRYP), and Hut 8 (HUT) also experienced gains of 17.8%, 16.5%, and 15.5% respectively, according to market capitalization data.
On a single day, Marathon Digital, CleanSpark, and Riot experienced significant growth; Marathon Digital saw an increase of 11%, CleanSpark followed closely behind with a rise of 10.2%, and Riot gained 9.5%.
TeraWulf (WULF) and Core Scientific (CORZ) also performed strongly on Oct. 28.
According to Askew, the miners who turned unprofitable after the Bitcoin halving event in April 2024 have since “surrendered” or “given up.
According to Askew, the reduction in “substantial selling force” is positive for price movements, implying an upward trend.
As I’ve mentioned, I anticipate a third adjustment in the mining difficulty, highlighting this observation based on the current trends.
On a positive note, “the surviving miners are in good health, and mining companies equipped with the most recent technology are enjoying robust profits,” remarked Askew. Furthermore, he added…
“We are so back.”
In a recent CNBC interview on October 28th, Matthew Sigel, who is the Head of Digital Assets at VanEck, pointed out that Argentina, the United Arab Emirates, and Ethiopia have all been reported to leverage their government-owned resources for Bitcoin mining.
Signal pointed out that the countries belonging to BRICS are working on strategies to conduct global trade using Bitcoin in the long run, serving as a means to bypass the use of the U.S. dollar.
Russia’s national wealth fund plans to invest in Bitcoin mining facilities across BRICS countries, envisioning a future where international trade could be conducted using Bitcoin. (Matthew Sigel, Head of Digital Assets at VanEck, speaking on CNBC Squawk)
— Business Blurb™ (@businessblurbb) October 28, 2024
Over the last fortnight, Bitcoin surpassed $70,000 for the first time since June 10. This remarkable achievement was due to significant investments, amounting to over $3 billion, flowing into U.S. Bitcoin exchange-traded funds (ETFs).
Multiple cryptocurrency investors often point out that Bitcoin experienced what’s known as a “golden crossover” – an optimistic chart pattern where the 50-day moving average moves above its 200-day long-term moving average. This could suggest a significant increase in price.
VanEck forecasts Bitcoin will hit $2.9 million per coin by 2050.
In order for that event to transpire, Bitcoin’s yearly growth rate must be around 16.6%, with this percentage compounding annually, for the upcoming 25 years.
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2024-10-29 04:21