JPMorgan warns about the danger of dropping BTC cost of production
According to the holding analysts, some market participants perceive the indicator “as the lower bound” of the first cryptocurrency’s price
14.07.2022 - 09:45
565
2 min
0
What’s new? According to financial holding company JPMorgan, bitcoin’s average cost of mining dropped from $24 000 to $13 000 in July, which could have a negative impact on the first cryptocurrency’s rate. Analysts explained that “the production cost is perceived by some market participants as the lower bound of the Bitcoin’s price range in a bear market.”
What else did JPM say? The drop in the production cost is mainly due to a decline in electricity consumption. The Cambridge Bitcoin Electricity Consumption Index (CBECI) was down by 14,8% in June compared to May.
JPMorgan explained that this situation reduces the pressure on mining companies to sell mined assets to increase liquidity and for deleveraging, ultimately increasing their profitability. However, at the same time, the decline in production costs may have a negative impact on the bitcoin price going forward.
As of July 14, 09:30 UTC, BTC is trading at $19 739, down by 0,45% per day, according to the Binance exchange.
Earlier, Binance analysts noted that the profitability of mining companies fell significantly in the prevailing market downturn, as it is directly proportional to the rates of the mined cryptocurrencies.
At the end of June, JPMorgan pointed to signs of an imminent recovery in the digital asset market. Thus, major players began to provide financial support to struggling companies, the industry is deleveraging, while venture capital investments, on the other hand, show a steady inflow.
Useful material?
Market
According to the founder of TRON, the leading US crypto exchange asked for several hundred million dollars for the listing of TRX
Nov 4, 2024
Incidents
The company conducted fictitious trading for six years to inflate the trading volume of tokens of several companies, receiving payment for these services
Nov 1, 2024
Market
1,5 million addresses have already left applications
Oct 31, 2024
Business
The company began investing in bitcoin in 2020, and since then, the value of its securities has risen by 1700%
Oct 30, 2024
Mining
The Deputy Energy Minister explained that in deficit regions, it is impossible to allocate large capacities for industry enterprises until 2030
Oct 30, 2024
Market
Customers will also be able to withdraw funds to bank accounts using cards
Oct 30, 2024