Bitcoin Mining Stocks Plummet as Miners Face Reduced Revenue Post Halving
Bitcoin mining companies are experiencing a significant decline in their stock prices as they face reduced revenue due to an upcoming code update for the largest cryptocurrency.
Companies such as Marathon Digital Holdings Inc., Riot Blockchain Inc., and CleanSpark Inc. have seen their stock prices fall for three consecutive days.
The Valkyrie Bitcoin Miners exchange-traded fund has also suffered a decline of approximately 28% this month.
The downward trend in Bitcoin mining stocks is further compounded by the accumulation of short interest in crypto-mining stocks and recent geopolitical tensions.
Iran’s retaliatory attack against Israel over the weekend has prompted a shift to a risk-off environment for investors.
However, despite these challenges, the CEOs of these mining companies remain optimistic about the future, highlighting low-cost operations, more efficient equipment, and growing demand for cryptocurrencies as factors that can offset the anticipated revenue losses resulting from the upcoming software update.
Jason Les, CEO of Riot Blockchain, expressed his confidence in the long-term prospects of Bitcoin.
“Riot is here for the long term… Our long-term investment thesis on Bitcoin is strong, and I think we have the setup for a very positive movement in Bitcoin over the next several months here,” he said in a recent Bloomberg Television interview .
Bitcoin mining is an energy-intensive process that involves using specialized computers to validate transactions on the blockchain and earn rewards in the form of tokens.
The majority of mining revenue comes from these rewards, which are halved every four years in an event called the halving.
The upcoming halving, the fourth since 2012, will reduce the
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