The analysis shows that bitcoin miners need the price of BTC to exceed $98,000 before halving to avoid being in the red.

Predictions that Bitcoin (BTC) will reach a six-figure price by the end of 2024 keep popping up. although BTC recently lost the $30,000 level.

For publicly traded bitcoin miners in particular, a price above $100,000 may be more of a necessity than a prediction. if they want their business models to remain profitable.

Is cutting Bitcoin in half bad for public miners?

Bitcoin miner stocks have been rising this year, well outperforming BTC in recent months. While BTC experienced a decline in volatility and a period of consolidation, shares of Bitcoin mining companies surged nearly 100% in a matter of months.

Seeking Alpha’s recent report explores BTC mining, specifically examining one popular miner: Riot Platforms.

It says that While Riot is expected to triple its mining capacity by 2024, the company and bitcoin miners in general could face significant challenges due to the halving. A 50% drop in BTC block rewards halves the main source of income for miners.

Miners like Riot can also issue new shares to fund their activities. This dilutes existing stocks, meaning that even if the company’s fundamentals hold up, the stock price may not hold up.

Add to that the fact that many miners may already be overbought at current valuations and things don’t look very rosy for bitcoin mining stocks. While mining public shares outperformed Bitcoin in 2023, an increase in BTC shipments to exchanges could signal a waning bullish momentum.

That’s why, a significant increase in the price of bitcoin will be necessary for miners to remain profitable at the current level of hash rate.

Bitcoin miners had a flop of the year.

RIOT up 457%
MARA increased by 421%
BITF up 337%
CLSK up 246%

Both Bitcoin and Nvidia have grown less than public miners this year, at 80% and 222%, respectively.

The best way to access BTC with leverage/high beta.

h/t @zackvoell pic.twitter.com/xTsJqikh0L

— Joe Consorti ⚡ (@JoeConsorti) July 18, 2023

Bitcoin miners had a year round.
RIOT up 457%
MARA increased by 421%
BITF up 337%
CLSK up 246%
Both Bitcoin and Nvidia have grown less than public miners this year, at 80% and 222%, respectively. The best way to access BTC with leverage/high beta. h/t @zackvoell

Miners may need six-figure bitcoin to stay afloat

How much should the price of BTC rise for miners to maintain their current valuations? The aforementioned report concludes that it may take around $100,000 to keep miners running as normal:

“Unless bitcoin surpasses our bitcoin thesis, we don’t see any way the bitcoin industry can walk away unscathed. Our modeling suggests that even at an ambitious 35 EH/s, Bitcoin needs to trade above $98,000 to justify the current RIOT (post-halving) valuation.”

Based on this, the report warns that Holding BTC mining shares is “extremely risky” as underlying fundamentals may not keep up with current valuations, which may not be factored into next year’s Bitcoin halving.

Will BTC price reach $125,000 in 2024?

From my side, A recent Matrixport report titled “Matrix on Target: Get Ready for Bitcoin’s $125,000 Target by the End of 2024” shows how BTC could reach $45,000 by the end of the year and $125,000 by the end of 2024.

The authors emphasize the importance of bitcoin’s price reaching an annual high for the first time in a year.

This signal always marks the beginning of a new bull market:

“Bitcoin hit a new yearly high on June 22, 2023, for the first time in a year. This signal has historically signaled the end of bear markets and the beginning of new cryptocurrency bull markets. The above events occurred in August 2012, December 2015, May 2019 and August 2020, with actual bull markets materializing in 2013, 2017 and 2021.”

Keep going:

“This signal has worked four times and in all four cases the bull market has fully developed within 12-18 months. Based on history, there is now a 100% chance that Bitcoin will experience another major bull market by the end of 2024 with a price target of $125,000 (+310%) based on the three signals above.”

This six-figure bitcoin price prediction echoes many others. Standard Chartered, for example, predicts the price of Bitcoin at $120,000 by the end of 2024. Interestingly, this is largely based on the fact that BTC miners do not sell bitcoin before the halving.

Bitcoin Could Hit $120,000 By The End Of 2024, Standard Chartered Predicts As Expected Improvement In Crypto Miner Conditions Allows Them To Hold More Tokens https://t.co/Z9z0BbKCqS

— Bloomberg Crypto (@crypto) July 11, 2023

Standard Chartered predicts that the price of bitcoin could reach $120,000 by the end of 2024 as the expected improvement in the fortunes of cryptocurrency miners allows them to hold more tokens.

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