Bitcoin Mining Opportunity Is Worth About $74B, JPMorgan Says

08/23/2024 20:57

The Wall Street bank updated its models and price targets for the miners to account for second quarter results and changes in the price of bitcoin and the network hashrate.

The bank reduced its CLSK, IREN, MARA and RIOT price targets to account for second-quarter results and changes in the price of bitcoin and the network hashrate.
JPMorgan prefers Iren and Riot Platforms, and says recent underperformance in these stocks presents a buying opportunity.
The bank estimates the notional value of the remaining bitcoin to be produced by miners at around $74 billion.

At current bitcoin {{BTC}} prices, the value of the remaining 1.3 million tokens left to be mined is about $74 billion, JPMorgan (JPM) said in a research report on Friday.

The bank reduced its price targets for some of the miners it covers to reflect second-quarter results and changes in both the price of bitcoin and the network hashrate. Hashrate refers to the total combined computational power used to mine and process transactions on a proof-of-work blockchain.

JPMorgan cut its CleanSpark (CLSK) price target to $10.50 from $12.50 while maintaining its neutral rating on the shares. It reduced the Iren (IREN) price target to $9.50 from $11 and kept its overweight rating. Underweight-rated Marathon Digital's (MARA) price objective was lowered to $12 from $14, and overweight-rated Riot Platforms' (RIOT) price objective was trimmed to $9.50 from $12.

The four-year block reward revenue opportunity is estimated to be around $37 billion, a drop of 19% since early June, but up 85% year-on-year, the report said.

The bank prefers Iren and Riot, and said recent underperformance in these stocks presents a buying opportunity for investors.

Riot has underperformed the sector year-to-date due to "operational snags," but JPMorgan sees the potential for better sentiment and share-price upside in the coming months due to enhanced uptime and production metrics.

The bank noted that Iren has traded lower in recent weeks after reporting a sharp rise in power costs in July in relation to hedging losses. JPMorgan says these missteps are correctable and present a nice buying opportunity.