Bitcoin – Here’s the true scale of halving’s impact on miners, mining rewards

• Bitcoin’s bullish price trajectory ensures profitability amid challenges
• Halving could cause supply shock, driving volatility and price rise 

The year 2024 has proven to be an exceptional one for Bitcoin [BTC], boosted by ETFs and capped off by its 4th halving. However, that’s not all as interestingly, there has also been a significant change in miner behavior.

In fact, recent data from CryptoQuant’s researcher revealed that miners have been sending approximately 374 BTC to spot exchanges daily over the past month. This amount was less than one-third of the daily average observed back in February. 

Source: CryptoQuant

How will Bitcoin’s halving affect miners? 

Contrary to what some would say, the Bitcoin halving event isn’t necessarily a doomsday scenario for miners. This, according to Adam Sullivan, CEO of Core Scientific. In a recent interview, he said,  

 “Bitcoin halving is not the Armageddon moment for us.”

He added, 

“Well today, with Bitcoin above $60,000, profitability means almost no machines are actually going to turn off. During the halving, many of them are going to maintain profitability.”

What this means is that numerous mining firms are financially robust and ready to endure short-term profitability challenges. Maybe, smaller, less efficient miners may face difficulties post-halving. This, however, would likely result in industry consolidation.

Is there potential for a supply shock? 

Mark Yusko, Founder of Morgan Creek Capital Management, believes otherwise though. He believes that Bitcoin’s halving event may be underestimated, with the potential for a significant supply shock. Shedding light on the same he said, 

“I actually think the halving is going to have a bigger impact and I don’t think it’s priced in. I think people are distracted by the demand shift that happened that caused this ATH.”

He added,

“So they’re forgetting that when the having occurs there will still be miners who are in trouble because their costs are fixed and the number of rewards goes down and so there’ll be a a supply shock event.”

Additionally, in a separate interview, Dan Dolev, Managing Director at Mizuho Securities, expressed the view that the halving event would prompt a “sell-the-news” reaction. 

@BobLoukas was quick to refute this though, stating, 

“‘The halving is not priced in.Totally False.”

Bitcoin’s future outlook

Despite prevailing skepticism before its halving, Bitcoin projected strong buying pressure post the event, as is evidenced by its price appreciation of 3.26%. According to David Alderman, a Digital Asset Research Analyst at Franklin Templeton, 

“As the price goes up, I think the noise is going up a lot more.”

Hence, it’s intriguing to observe that despite ongoing geopolitical tensions, Bitcoin has adhered to its historical patterns and surged following the halving event. 

Source: LayahHeilpern/Twitter