JPM in a crypto note, looking for a lower BTC price once bitcoin-halving-induced euphoria subsides after April. In brief:
- the halving event will reduce Bitcoin miners’ rewards from currently 6.25 BTC per block to 3.125 BTC
- this will
negatively impact miners’ profitability - will lead to a higher bitcoin
production cost, and the bitcoin production cost
influences its price - “The bitcoin
production cost has empirically acted as a lower bound for bitcoin
prices. The central point of our
estimated production cost range stands at $26,500 currently, which
would mechanically double post halving event to $53,000.” - is a possibility of a 20% decline in the Bitcoin
network’s hashrate post halving, - mainly because of less efficient rigs
exiting mining operations due to reduced profitability - which would lower the central point of the estimated production cost
range to $42,000, based on an electricity cost
This article was written by Eamonn Sheridan at www.forexlive.com.
