[Bitop Review] US Mining Companies Reach Record High Market Capitalization, but Why Are Miners Still Dumping Bitcoin?
Recently, as the price of Bitcoin continues to rise, the stock prices of many Bitcoin mining companies have also skyrocketed, achieving remarkable performance. Just yesterday (17th), JPMorgan pointed out in its latest research report that the total market capitalization of the 14 US-listed Bitcoin mining companies it tracks has reached a record high of $22.8 billion on June 15th.
Core Scientific’s stock price skyrockets nearly 200% in a month
JPMorgan pointed out that in the first half of June, the stock prices of these 14 mining companies almost all outperformed Bitcoin. Core Scientific (CORZ), one of the world’s largest mining companies, rose the most, reaching 117%, and has skyrocketed nearly 297% in the past month. Its market capitalization has reach 1.732billion.
However, Argo Blockchain (ARBK) performed the worst, falling 7% in June. It’s the only mining company to underperform Bitcoin.
Core Scientific cooperates with CoreWeave
As for the reason for Core Scientific’s stock price surge in June, it may be attributed to the cooperation with AI company CoreWeave that announced earlier this month.
On June 3, Core Scientific announced that it has signed an agreement with CoreWeave. As part of the cooperation, Core Scientific will provide CoreWeave’s GPUs with up to 200 megawatts of power hosting services. It is expected to bring Core Scientific a total cumulative revenue of more than $3.5 billion.
CoreWeave is a cloud service provider that provides high-performance computing resource leasing services. Due to its close relationship with Nvidia, it has a nickname called “Nvidia’s son”.
Bitcoin mining difficulty continues to decline after halving
JPMorgan analysts Reginald Smith and Charles Pearce also said that since Bitcoin completed a new halving in April, the difficulty of Bitcoin mining has also been continuously declining. The share of these 14 listed mining companies has also increased with the growth: “The network hash rate (a measure of industry competition and mining difficulty) has decreased by about 1% (7 EH/s) since May. These 14 companies now account for about 23.8% of the global network hash rate, an increase of 1% from last month, which is an exciting sign.”
Bitcoin miner balance drops to 1.8 million
However, according to Glassnode data, although the stock prices of mining companies have continued to rise and the difficulty of mining has decreased. The BTC balance in the wallets of Bitcoin miners has been continuously decreasing by 30,000 since October 2023, with a total of about 1.8 million.
There are two possible reasons for this: on the one hand, it may be because after the halving of Bitcoin, the operating costs of mining companies have increased, and they need to sell Bitcoin to obtain operating funds or purchase new equipment to improve their own mining capabilities. On the other hand, smaller mining companies may have become unsustainable and can only sell Bitcoin to make a profit and close their mining business. (This is why the mining difficulty has decreased, but miners continue to sell BTC.)
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