Bitcoin miners have tumbled since last Thursday, following the launch of spot bitcoin exchange-traded funds . However, for some mining stocks, any weakness in the coming weeks is an opportunity, according to Bernstein. The declines are in part due to the pullback in the bitcoin price, which is down roughly 6% in the same period. In a Monday note to investors, Bernstein also pointed to lower investor appetite for mining stocks as a bitcoin proxy now that ETFs have entered the market. However, Gautam Chhugani, lead crypto analyst at Bernstein, said the firm is still optimistic on high-quality miners, calling out Riot Platforms and CleanSpark . “We feel confident about inflection in miner cashflows for the best-in-class miners that are consolidating capacity and seeing strong traction in revenues from higher bitcoin price and transaction fees,” he said. “Thus, miners would continue to offer higher beta trade to the next bitcoin inflection — in our view, post halving.” RIOT YTD mountain Riot Platforms is down 25% this year Since spot bitcoin ETFs began trading in the U.S. last week, Riot and CleanSpark have each declined more than 20%. Marathon Digital has declined nearly 30%. Iris Energy and Cipher Mining are each lower more than 21%. The bitcoin halving — the event in which the reward for mining the cryptocurrency is cut in half — is approaching in the spring of this year. The halving also eats into bitcoin miners’ revenues. Investors are watching the price of bitcoin, which was expected by some to rally after the Securities and Exchange Commission’s decision to allow spot bitcoin ETFs in the U.S., but instead played out as a sell-the-news event. If bitcoin doesn’t rise to the $50,000 to $55,000 range, less efficient, higher-cost miners may not have sufficient capital to grow and may have difficulty maintaining their operations. “Just like bitcoin, the next two months offer dip buying opportunity in bitcoin miners,” Chhugani said. “To be cautious during [the] halving, some higher cost miners may struggle if bitcoin price remains flattish from here — hence, best to be exposed to low cost miners.” Bitcoin miners were top performers in 2023, outperforming even bitcoin. Riot and CleanSpark gained 356% and 440%, respectively. Marathon swelled by 586%. Flagship crypto bitcoin finished up 157%.
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