According to Cointelegraph: Contrary to past trends, the forthcoming Bitcoin halving may not necessarily result in reduced profitability for miners, says Laurent Benayoun, CEO of Acheron Trading. Despite the 50% reduction in Bitcoin supply issuance after the halving event, Benayoun suggests that increasing network fees might compensate for decreased mining rewards.
The Bitcoin halving is scheduled to occur on April 19, cutting block issuance rewards from 6.25 BTC to 3.125 BTC. In previous halving scenarios, smaller mining operations often exited the industry due to diminished block rewards.
However, the CEO postulates that the situation would differ post-2024 halving because of the rising network fees, spurred by Ordinals inscriptions and Bitcoin-native decentralized finance, or BTCFi.
Current average Bitcoin network fees, which incentivize miners to include a transaction in the next block, stand at $4.88 per transaction, down from $16.13 a month ago. However, these fees have surged over 86% in the past year.
Joe Downie, chief marketing officer of NiceHash, affirms that Bitcoin miners would typically remain profitable if the BTC price stays above the $70,000 mark since they're profitable at a BTC price over $35,000 at the current block rewards.
Factors like the quality and energy efficiency of a mining firm's equipment will also influence its profitability beyond Bitcoin's price, explains Downie. Therefore, despite the halving event, miners with newer, more energy-efficient models will likely still turn a profit.
The impact of Bitcoin’s price appreciation, coupled with the increase in network fees, could mean fewer mining companies being forced out of business in the aftermath of this halving, compared to previous cycles, according to Benayoun.