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US-Listed Bitcoin Miners Hit Record Market Cap of $22.8B

US-Listed Bitcoin Miners Hit Record Market Cap of $22.8B

Jun 17, 2024
Bitcoin Mining

US-Listed Bitcoin Miners Hit Record Market Cap of $22.8B

A JPMorgan report has disclosed that U.S.-listed Bitcoin mining companies have reached an unprecedented total market capitalization of $22.8 billion as of mid-June, as reported by CoinDesk.

The report, released on Monday, highlights that the aggregate market cap of the 14 U.S.-listed Bitcoin mining stocks tracked by JPMorgan hit a new high on June 15. The bank's analysts, Reginald Smith and Charles Pearce, pointed out that almost all tracked companies outperformed Bitcoin in the first half of June, with Core Scientific (CORZ) leading the pack with a 117% surge, while Argo Blockchain (ARBK) was the exception, declining by 7%. During the same timeframe, Bitcoin itself experienced a 3% drop.

Investors have shown a keen interest in the sector, particularly following news of Core Scientific's potential deal with AI firm CoreWeave. The AI cloud provider had offered to acquire Bitcoin miner Core Scientific for $1.6 billion, a 55% premium on its market price, although the bid was rejected. Instead, a 12-year, $3.5 billion partnership was established, allowing CoreWeave to leverage Core Scientific’s data centers for its AI services.

The focus on AI diversification is not isolated to Core Scientific. Other mining firms like Hut 8 and IREN are also venturing into similar initiatives, aiming to broaden revenue streams especially after the Bitcoin halving in April, which slashed miners' block subsidy rewards by half.

Moreover, JPMorgan's analysts observed an increase in the U.S. miners' share of the global network hashrate. The 14 companies now represent roughly 23.8% of the global network hashrate, marking a nearly 1% gain from the previous month. This shift is attributed to the scaling back of operations by less efficient private operators after the halving event.

As reported by The Block, despite a general decline in the network hashrate since the halving, with the seven-day moving average of daily hashrate dropping from 629.44 EH/s to 598.08 EH/s, the dominance of U.S.-listed miners has been on the rise. The report suggests that this group of miners is currently trading at approximately 2.25 times their proportional share of the anticipated four-year block reward opportunity, which is the highest point since February 2024.

JPMorgan analysts also noted that the hashprice, which indicates potential earnings per unit of hashrate, remains low but is expected to rise as the network hashrate continues to decline. This trend could signal an upcoming increase in profitability for miners if the hashprice rebounds.

As the Bitcoin mining industry adapts to the changes post-halving and explores new business avenues, the market cap milestone indicates investor confidence and the potential for continued growth in this sector.

CoinDesk Article

The Block Article


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