U.Today is supported by its audience. When you buy through referral links, we may earn a commission.

Annual Bitcoin (BTC) Mining Revenue to Drop to $3.1 Bln After Halving: Report

News
Fri, 02/21/2020 - 19:45
Alex Dovbnya
This Kraken report highlights why the price of Bitcoin (BTC) needs to significantly increase after the halving to keep miners afloat
Cover image via U.Today
Contents
Put your crypto to work
10
BTC
  • $68.96

    Interest per week

  • $3585.7

    Interest per year

  • 4.15%

    Interest rate

Join Now!

Kraken, one of the leading cryptocurrency exchanges, has just released its latest report on the upcoming Bitcoin halving.

It has estimated that the global mining revenue is going to lose $3 bln in annual revenue after the highly-anticipated event due to the 50 percent supply reduction if the BTC price were to stay at the $9,300 level.  

Earlier this February, TradeBlock concluded that the BTC price has to be at least $15,062 after the halving for miners to break even. Otherwise, their exodus will lead to a sharp drop in the hashrate.   

Related
Bitcoin Halving Will Inevitably Move BTC Price: Alistair Milne

The most important question of 2020   

While it's logical to assume arguably the most important event that was coded in the Bitcoin blockchain has been already priced in, history shows that it might not be the case. 

Kraken states that Bitcoin appreciated more than 9,000 percent during its previous bull run. BTC reached its current all-time high of $19,499 18 months after the halving event. 

image by blog.kraken.com

Related
Bitcoin (BTC) Halving Is Not Priced In, Says Lolli CEO Alex Adelman

Solidifying the store of value narrative 

Kraken states that this halving is particularly significant because Bitcoin's inflation rate will be reduced by 1.8 percent, which is lower than the 2 percent target adopted by most central banks. 

Disinflationary assets like Bitcoin and gold serve as a store of value. Both of these assets are valued because of their scarcity that can be measured with the help of their respective stock-to-flow models. BTC will surpass the SF of the lustrous metal after its fourth halving in 2024. 

 

About the author

Alex Dovbnya (aka AlexMorris) is a cryptocurrency expert, trader and journalist with extensive experience of covering everything related to the burgeoning industry — from price analysis to Blockchain disruption. Alex authored more than 1,000 stories for U.Today, CryptoComes and other fintech media outlets. He’s particularly interested in regulatory trends around the globe that are shaping the future of digital assets.

Recommended articles
Top 10 Best Cloud Mining Sites in 2020
TOP 20 Best Bitcoin Trading Bots in 2020
TOP 3 Price Predictions: BTC, ETH, XRP — Uncertainty Before Sharp Movement
Bitcoin (BTC) and Gold (XAU) Benefit Amid Plenty of Fear and Blood: Dan Tapiero
Bitcoin (BTC) Dominance May Reach 90% During Crisis. Will Price Follow?