Bitcoin News
By Jean-Luc Maracon
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$78,000: The Threshold That Hurts Small Miners. The production cost of $78,000 is an average. This means some miners produce well below this…
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Consolidation Ahead for the Mining Industry. When margins disappear, the sector tightens. It's mechanical.
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JP Morgan has released a stark figure: twenty percent of Bitcoin miners are currently operating at a loss. The reason?
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This is a significant threshold. When the market trades below the production cost, miners lose money with every block validated. Not just a little. Structurally.
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The production cost of $78,000 is an average. This means some miners produce well below this threshold—those who have negotiated discounted electricity contracts, those with the…
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The 20% unprofitable miners mentioned by JP Morgan are likely at the bottom of the scale. Operations that pay too much for electricity, run on outdated equipment, or are located…
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And the pressure doesn't just come from the price. Operational costs—electricity, cooling, maintenance, data center rents—don't decrease because Bitcoin's price drops.
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It's not yet clear if JP Morgan anticipates an acceleration of market exits in the short term.
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When margins disappear, the sector tightens. It's mechanical. Miners who can no longer cover their costs have three options: sell their equipment, merge with a stronger…
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Selling mining equipment, for instance, takes time. The secondary market for ASICs poorly absorbs large volumes.
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See also: Franklin Templeton files two Bitcoin ETFs with a 20% crypto cap
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Consolidation clearly favors the big players. Publicly traded mining companies, with credit lines and teams dedicated to energy optimization, can absorb the small ones.
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Read also: JPMorgan Flags 20% of Bitcoin Miners Underwater as 32,000 BTC Gets Dumped
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And it changes the industry's structure. Fewer miners. Larger miners. Potentially more centralized.
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This point deserves attention. The decentralization of the Bitcoin network partly relies on the diversity of miners.
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