Bitcoin Mining Stocks Fall After BTC Price Hits $49K

Bitcoin Mining Stocks Fall After BTC Price Hits $49K

Bitcoin miners faced a decline on Thursday, relinquishing earlier gains in response to the cryptocurrency’s price retreat after the U.S. Securities and Exchange Commission’s (SEC) approval of the inaugural U.S. spot Bitcoin exchange-traded funds (ETFs).

Marathon Digital and Riot Platforms, the two most extensive mining stocks, experienced 12% and 15% losses, respectively. Meanwhile, Iris Energy fell by 6%, and CleanSpark saw a 7% decline.

Investor Profit-Taking Amidst Volatility

Investors opted to take profits after Bitcoin briefly surged above $49,000, marking the first occurrence since December 2021. The cryptocurrency’s price subsequently retraced to approximately $46,000 amid the volatile trading environment.

Previously among the most significant gainers in the stock market throughout 2023, Bitcoin miners are now witnessing a correction. According to CNBC, Marathon achieved an impressive gain of nearly 590%, while Riot rose by more than 350%. CleanSpark and Iris Energy also posted notable gains, exceeding 400%.

Miner revenue has recently declined as BTC transaction fees lowered, according to data from CryptoQuant. The drop in fees, attributed to a decrease in transaction activity on the network, impacts mining companies’ revenue, as explained by CryptoQuant’s Julio Moreno.

Anticipation and Preparations for Bitcoin Halving

Investors may also adjust their positions in anticipation of the upcoming Bitcoin halving, slated for April. During this event, the mining reward for mining Bitcoin and mining companies’ revenue will be halved in adherence to the Bitcoin code.

According to Reuters, the impending halving is considered a market-clearing event for miners. While historically preceding significant gains in Bitcoin benefiting mining stocks, it could potentially lead to the exit of unprofitable miners from the market. This, in turn, may provide more sustainable miners with an opportunity to gain a larger market share, shaping the landscape following the halving event.

Photo: Dmytro Demidko/Unsplash

TokenPost | [email protected]

<Copyright © TokenPost. All Rights Reserved. >