The long-awaited Bitcoin halving occurred late Friday, reducing the rewards for miners by half. Every fourth year, this technical occurrence happens for Bitcoin, the leading cryptocurrency, and could trigger a significant price increase.
HISTORY: THE 4TH #BITCOIN HALVING HAS OFFICIALLY HAPPENED
— Rizzo (@pete_rizzo_) April 20, 2024
Based on CNBC’s reporting, historical data shows that Bitcoin reaching the halving point has typically triggered major price surges, resulting in new record-high values for the cryptocurrency following each occurrence.
The greatest increases in Bitcoin’s value tend to occur following a halving event, as shown in this illustrative graph by VanEck. (Mention of Matthew Sigel and Jan van Eck for credit.)
— Gabor Gurbacs (@gaborgurbacs) April 17, 2024
In the current bitcoin mining scenario, miners have had ample time to get ready for the upcoming halving event. By doing so, they have pursued lower energy expenses and acquired advanced, energy-efficient machinery. As reported by CNBC, certain mining companies such as Core Scientific and Bitdeer have adopted a multi-pronged strategy, expanding their business domains beyond Bitcoin mining alone to secure additional sources of income.
According to CNBC’s report, the entry of new miners into the market has been squeezing profits for some time. However, the arrival of U.S. bitcoin ETFs has disrupted pricing patterns. As per the article, Bitcoin had reached a new peak price of over $73,000 in March, just before the halving event, even without these ETFs.
CNBC reports an intriguing shift in miner revenue sources: while the block reward used to be the main income, it is now being overshadowed by transaction fees. This change is attributed to the increasing number of projects developing on Bitcoin’s blockchain, leading to higher demand for transaction confirmations and consequently, more revenue for miners. Bill Barhydt, Abra’s CEO, shares this perspective with CNBC, forecasting that transaction fees could reach ten times their peak value within the next 24 months.
During the ongoing halving process, CNBC reveals that certain miners are considering entering the burgeoning industry of artificial intelligence (AI). According to CoinShares, a digital asset fund manager, an increasing number of miners might transition towards AI in regions with stable energy sources, as they stand to gain greater profits. Nevertheless, shifting from Bitcoin mining to AI is not a simple task, as it involves setting up unique infrastructure and acquiring new expertise among staff members, as reported by CNBC.
Based on CNBC’s report, various mining companies such as BitDigital, Hive, Hut 8, Terawulf, and Core Scientific are either currently utilizing AI technology or have plans to expand in this area. For instance, Core Scientific has teamed up with CoreWeave, a cloud service provider specializing in machine learning applications. According to CEO Adam Sullivan, the collaboration will enable the processing of both AI and High-Performance Compute tasks, bringing in an estimated revenue of $100 million.
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2024-04-22 22:55