EIA to survey crypto miners on their vitality use – BTIG

starcrypto — Whereas 2024 was lower than two weeks in the past, the 20% drop within the authentic cryptocurrency’s worth because the convention in Nashville makes it really feel like a distant reminiscence. 

BTIG mentioned in a analysis report on Tuesday that the most important takeaway from Bitcoin 2024 was the continued enlargement of the ecosystem and the rising demand for electrical energy to help it. They famous that competitors for energy is anticipated to extend over the following few years.

Mergers and acquisitions had been additionally a significant theme at Bitcoin 2024, notably amongst miners. BTIG analysts famous that post-halving, some Bitcoin mining operations lack the capability and capital to scale their companies. 

The latest drop in Bitcoin costs into the low $50,000 vary has made mining with older fashions, such because the S19 J Professional+, a difficult route. BTIG said, “We consider {that a} extended Bitcoin worth vary within the low $50k vary may power some smaller miners to look to merge with bigger established miners.”

At present, the Bitcoin worth is round $53,000, which interprets to a $0.03-$0.04/kWh unfold for the most recent mining gear, assuming an influence worth of $0.05/kWh. The report additional particulars that the worldwide hash fee’s August common month-to-date is about 662 EH, up 8% month-over-month and 50% from October 2023. This factors to more and more difficult mining economics for older fashions, the place Bitcoin worth income on a $/kWh foundation roughly equals a $0.05/kWh energy worth.

In the meantime, Riot Platforms (NASDAQ:) has acquired Block Mining for roughly $125 million, offering the crypto miner with fast entry to 60MW of capability throughout two websites in Kentucky, anticipated to scale to 110MW by year-end and 305MW by the top of 2025. 

BTIG commented, “This acquisition diversifies RIOT’s operations out of Texas and paves the best way for RIOT to have 2GW of capability, with 1.7GW in Texas and 0.3GW in Kentucky.” They added, “We anticipate bigger miners with entry to capital to proceed to consolidate the US Bitcoin mining market.”

Cleanspark (NASDAQ:) additionally acquired GRIID, increasing its presence into Tennessee. BTIG noticed, “The consolidation part is pushed by the necessity for scale and effectivity in an more and more aggressive panorama.”

Elsewhere, the Power Data Administration (EIA) introduced a deliberate second try to survey the Bitcoin mining trade on their vitality use, following an preliminary try in February. Preliminary evaluation pointed to cryptocurrency mining consuming 0.6%-2.3% of whole US electrical energy. BTIG famous, “The announcement comes amid Dominion Power’s (NYSE:) assertion that it might must construct as much as eight peaker vegetation over the following 10-15 years to fulfill rising energy demand from knowledge facilities.” 

BTIG up to date their forecasts for Riot Platforms and Marathon Digital (NASDAQ:) following their 2Q24 earnings. For 2024 and 2025, BTIG’s income targets for RIOT are roughly $368 million and $617 million, respectively, and for MARA, $613 million and $744 million. BTIG’s Bitcoin worth estimates for 2024 and 2025 are $62,000 and $72,000 on common, respectively. 

“We assume a continued upward trajectory in Bitcoin costs, offering a lift to miners’ margins,” BTIG analysts said.