JPMorgan analysts downgrade their estimate of the average cost to mine bitcoin
JPMorgan analysts downgraded their estimate of the average cost of mining 1 bitcoin
Changes in electricity prices will have less impact on the efficiency of cryptocurrency mining, the bank's experts believe
Analysts at investment bank JPMorgan lowered their estimate of the cost of mining 1 bitcoin (BTC) from $21 thousand to $18 thousand after the Cambridge Center for Alternative Finance revised the methodology of the index of electricity consumption in mining, reports The Block.
Changes in electricity prices will have less impact on the efficiency of cryptocurrency mining, according to the bank's experts.
"Previously, we considered that an increase or decrease in costs by 1 cent per 1 kW⋅h leads to a change in the cost of mining by $4.3 thousand. After revising the methodology, we lowered the estimate to $3.8 thousand," the report says.
After halving the estimate will automatically double, the bank's analysts predict. This is because miners' remuneration will be halved and any changes in electricity costs will have a greater impact on their overall costs, making cost management even more important, the publication notes.
What is bitcoin halving and how will it affect the price of the first cryptocurrency
In August, Pantera Capital predicted bitcoin would rise to $148k after halving in 2024. The court ruling on the XRP token and the approval of BlackRock's application for a spot bitcoin-ETF in addition to the halving will provide a strong foundation for bitcoin market growth, analysts said.
Nearly 60% of investors said they expect bitcoin to rally after the April 2024 halving. 17% of investors believe there will be no sustained bitcoin rally after the April 2024 halving.
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