Bitcoin halving ‘blood bath’ could push US miners offshore #Write2Earn #TrendingTopic
Hashlabs Mining co-founder and chief mining strategist Jaran Mellerud said Ethiopia, Nigeria, Kenya, Argentina and Paraguay could pick up more hash rate in the coming years.
Potential sluggishness in the price of Bitcoin after the Bitcoin halving could tank the share prices of high-cost public miners in the United States, forcing some to even move offshore.
“We might see a mining stock blood bath as investors realize these companies are barely making money,” says Jaran Mellerud, founder and chief mining strategist of Hashlabs Mining, referring to what could happen if the Bitcoin
price doesn’t rise substantially after the halving.
Mellerud is now eyeing the three to four-month window after the halving to see the extent to which miner profitability is pressured by the slashing of block rewards.
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The next Bitcoin halving is expected to occur on April 24, according to CoinMarketCap. It will reduce Bitcoin miner rewards from 6.25 BTC ($321,000) to 3.125 BTC ($160,500), though it has historically been followed by a surge in the price of Bitcoin.
In the last halving event on May 11, 2020, Bitcoin was priced at $8,750 and surged over 430% five months later in October from $11,500 to $61,300 by mid-March 2021.
But if Bitcoin fails to make a major run before that three to four-month interval, “a significant part of the network might have to turn off their machines, particularly those paying hosting rates of $0.07 per kWh or more,” Mellerud said, adding that a large concentration of these inefficient miners are located in the United States.
As a result, Mellerud expects some of Bitcoin’s hash rate to shift from the U.S. to countries with cheaper electricity rates,
