Cantor Fitzgerald Report: 11 Publicly Listed Mining Companies May Struggle to Profit from Mining Operations After Bitcoin Halving

Cantor Fitzgerald Report: 11 Publicly Listed Mining Companies May Struggle to Profit from Mining Operations After Bitcoin Halving

Cantor Fitzgerald Report: 11 Publicly Listed Mining Companies May Struggle to Profit from Mining Operations After Bitcoin Halving

According to analysts from financial services company Cantor Fitzgerald, if the price of Bitcoin (BTC) does not rise significantly after the halving, the 11 largest publicly-listed Bitcoin mining companies may have difficulty profiting from mining.

Matthew Shultz, the CEO and co-founder of US Bitcoin mining company CleanSpark, quoted Cantor Fitzgerald’s research on the X platform on Friday (26th). The data showed that several mining companies, including Marathon Digital, Riot Platforms, and Core Scientific, may face greater pressure after the halving, as the Bitcoin they obtain from operations may not offset the costs.

The research indicates that UK mining company Argo Blockchain and US mining company Hut 8 may be the least profitable mining companies after the halving (based on the current Bitcoin price). Their “all in per coin” costs are $62,276 and $60,360 respectively. Hut 8, in its latest mining operation report released on January 5th, stated that its total Bitcoin reserves are 9,195 BTC, valued at $377 million at the current price.

Cantor Fitzgerald’s analysis of publicly-listed mining companies’ all in per coin costs, source: Matthew Shultz. Cantor’s “all in per coin” indicator refers to the total cost for Bitcoin miners to produce one Bitcoin, including electricity fees, hosting fees, and other cash expenditures. Cantor analysts predict that the only companies that can remain profitable after the halving, assuming a $40,000 average Bitcoin price and no significant changes in mining power, are Singaporean mining company Bitdeer and CleanSpark.

According to CoinMarketCap data, at the time of this article’s publication, there are only 83 days left until the Bitcoin mining reward halves.

Using derivatives to hedge risks
Although many experts believe that the reduction in supply is bullish for the Bitcoin price in the long term, it also means that miners with high operating costs may be affected. Dan Rosen, the Vice President of Derivatives at Bitcoin mining company Luxor, pointed out that miners often adopt strategies to hedge potential losses caused by Bitcoin price fluctuations.

In an interview with Cointelegraph, Rosen stated that strategies commonly used by miners include purchasing derivative financial products such as hash rate futures contracts and Bitcoin-related options to mitigate any potential volatility.

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Related report: “US mining company Core Scientific focuses on improving efficiency, may hedge if Bitcoin rises to $40,000”