Bitcoin Price Below $80,000 At Halving Could Trigger Miner Losses – Fidelity
Fidelity Digital Assets speculates losses for some miners if the Bitcoin price remains under $80,000 after the upcoming halving in April.
The company released its 2024 market outlook, highlighting the growth recorded so far in Bitcoin, the state of miners, and possible perspectives for the near future.
Bullish narratives have been on the rise in the past several months, as Latin American adoption is growing and the US SEC approved spot Bitcoin ETFs.
However, analysts at Fidelity suggest possible miner losses if the Bitcoin price does not soar over $80,000. The next halving expected in April will see block rewards reduced by 50%, resulting in a slash in revenues.
Still, since halvings are associated with bullish momentum around the cycle, the price of the asset is expected to soar post-halving to cover losses.
Bitcoin miners faced a turbulent season leading up to the halving year before the recent price surge. The 2022 bear market occasioned a 55% price drop that took miners underwater.
The winter led to miners selling their Bitcoin reserves, pivoting to Artificial Intelligence (AI) computing, and selling equipment to stay afloat.
In a turn of events, the institutional inflows recorded in Q2 2023 on the heels of an imminent spot BTC ETF approval led to price upticks.
Miners moved back into the green zone and are hedging assets to build capacity for the upcoming reward slash.
At present prices above $45,000, miner revenues are at $40 million, up $10 million on average. However, for present profits to remain, the Bitcoin price needs to soar to $80,000. This will maintain the status quo after the halving, preventing selling pressures from miners.
Per Fidelity:
“In a scenario where the price does not rise to $80,000 before the halving,
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