Bitcoin Miners Prepare for Reporting Season
Date: 2024-10-30 Author: Oliver Abernathy Categories: CRYPTO PAYMENTS
Bitcoin prices remained volatile in Q3 2024, impacted by economic uncertainty in the US, international tensions, and the upcoming presidential election. BTC hit a low of $49,100 in August, but then rebounded sharply after the US Federal Reserve cut interest rates in September for the first time in four years. This event sent BTC rising to $63,250 by the end of the quarter.
A significant increase in demand for Bitcoin was also due to the US spot Bitcoin ETFs, which attracted net inflows of $4.3 billion in the third quarter, which is significantly higher than the $2.4 billion in the second quarter. One-third of these investments came in the eight days after the Fed's decision to cut rates. Analysts expect the upcoming elections on November 5 to have a significant impact on the price of BTC: a victory for Donald Trump could lead to an increase in prices, while a victory for Vice President Harris could cause a short-term correction in the rate.
The operational activity of public Bitcoin miners also increased significantly during the reporting period: the global network hashrate increased by 35 exahashes per second, which is 4.5% more than in the previous quarter. However, the expansion of capacity comes with serious challenges - the halving will take place in April 2024, as a result of which the reward for block mining will be halved. This process, which is an important part of Bitcoin’s inflation control mechanism, makes mining less profitable and requires miners to improve their efficiency to maintain profitability.
Despite these efforts, total miner revenue fell 29% to $2.6 billion in Q3. In addition, the average price per terahash fell, adding to the pressure on market participants. However, analysts see potential opportunities for investors in the current situation. The market cap of public BTC miners has fallen 7%, which could indicate attractive buying conditions, especially given the 12% recovery in the sector this quarter.
The earnings season for miners begins this week, and all eyes will be on how companies perform amid the current rise of BTC above $73,000.
