The market will reward Riot Platforms (RIOT) and CleanSpark (CLSK) for their superior execution and for leading the market in self-mining hashrate; broker Bernstein stated as much in a research report on Wednesday. Investors should purchase these companies as the “miner fear factor” is at its peak ahead of the impending halving.
Although the halving raises questions about profitability after incentives are lowered by 50%, Bernstein observes that mining equities have underperformed bitcoin (BTC) year-to-date. It is scheduled for April 19–20 and occurs every four years. It slows the rate of increase in the quantity of bitcoin. When mining and processing transactions on a proof-of-work blockchain, the entire combined computational power is referred to as hashrate.
Analysts Gautam Chhugani and Mahika Sapra noted, “Historically, bitcoin price breakout has always followed the halving event and sometimes a few months after halving.”
The authors noted that, in the current 2024 cycle, “the exchange-traded fund (ETF) approvals in January led to a strong price appreciation pre-halving,” adding that, as a result of slower ETF inflows, bitcoin has fallen as much as 15% in the previous 10 days alone. The broker predicted that after the halving, bitcoin’s positive trajectory will continue until mining hashrates have adapted to the reduced payouts and ETF inflows start up again.
According to Bernstein, the introduction of spot bitcoin exchange-traded funds (ETFs) by wirehouses and registered investment advisers (RIAs) “will continue to provide structural demand for bitcoin.” “By 2025, we still anticipate that bitcoin will reach a cycle high of $150K.”