Posted on

Bitcoin Mining Economics Weakened in February: JPMorgan

The total market cap of the 14 publicly-listed U.S. miners that Wall Street bank JPMorgan (JPM) tracks dropped 22% in February as the bitcoin (BTC) price declined and mining economics came under pressure.

Bitcoin miners with high performance computing (HPC) exposure fell following the DeepSeek artificial intelligence (AI) announcement, and due to concerns about demand for data center capacity in the near-term, the bank noted.

Revenue and profitability fell last month. The bank estimated that bitcoin miners earned $54,300 per EH/s on average in daily block reward revenue in February, a 5% decline from the month previous.

“Daily block reward gross profit declined 9% m/m to $29,500 per EH/s in February,” analysts Reginald Smith and Charles Pearce wrote.

The average network hashrate rose 3% to 810 exahashes per second (EH/s) last month, the report said.

The hashrate refers to the total combined computational power used to mine and process transactions on a proof-of-work blockchain.

Mining difficulty rose 2% from January, the bank said. Network difficulty is now 28% higher than before the halving event in April last year.

Core Scientific (CORZ) was the best performer with a 9% drop, and Greenidge Generation underperformed with a 36% decline for the month, the report added.

Read more: U.S.-Listed Bitcoin Miners Accounted for 29% of Global Hashrate in February: JPMorgan

Posted on

Crypto Market Faces Weak Demand, Needs Trump Initiatives to Kick In, JPMorgan Says

The cryptocurrency market is lacking positive catalysts in the near term, Wall Street bank JPMorgan (JPM) said in a report Wednesday.

The correction in crypto markets in recent months has seen both bitcoin (BTC) and ether (ETH) futures near backwardation, which is a sign of lower demand, the report said. Backwardation occurs when the spot price of an asset is higher than the price trading in the futures market.

“This is a negative development and indicative of demand weakness by those institutional investors that use regulated CME futures contracts to gain exposure into these two cryptocurrencies,” analysts led Nikolaos Panigirtzoglou wrote.

If demand for bitcoin and ether futures is healthy, the futures cost more than the spot price, and the curve is said to be in contango, the bank noted.

When demand slows and price expectations soften, the futures curve moves towards backwardation, the bank added.

This weakness in demand could be due to a number of reasons.

Positive crypto initiatives by Trump’s new administration are more likely to kick in during the second half of the year, the bank said, and this means institutional investors are likely taking profits due to a lack of short-term catalysts.

Lower demand from systematic and momentum-driven funds, such as CTAs, has also affected bitcoin and ether futures, JPMorgan added.

Read more: U.S. Crypto Task Force to Focus on Delivering National Bitcoin Reserve: Bernstein

Posted on

U.S.-Listed Bitcoin Miners Accounted for 29% of Global Hashrate in February: JPMorgan

The total hashrate of the U.S.-listed bitcoin (BTC) miners tracked by JPMorgan (JPM) has almost doubled from a year ago and now accounts for about 29% of the global network, the bank said in a report on Tuesday.

The combined hashrate of the 14 companies “has increased ~95% y/y to 244 EH/s, versus a 45% increase in the network hashrate,” analysts Reginald Smith and Charles Pearce wrote.

The network hashrate is a proxy for competition in the industry and mining difficulty. The Bitcoin network hashrate has risen about 6% so far this month, and has climbed 45% in the last 12 months, the report said.

“Average bitcoin price also declined modestly from January, pressuring mining economics,” the authors wrote.

The hashprice, a measure of daily mining profitability, dropped 13% from the end of January, as the hashrate rose and the bitcoin price fell, JPMorgan said.

The bank estimated that miners earned around $53,600 in daily block rewards this month, 6% lower than in January.

The total market cap of the bitcoin mining stocks in the bank’s coverage was 1% lower than the month previous, the report added.

IREN (IREN) outperformed in the first two weeks of February with a 27% gain, the bank noted. Greenidge Generation (GREE) underperformed with a 20% drop.

In a Monday report, broker Bernstein said U.S. bitcoin mining stocks were increasing their share of the network hashrate.

Read more: U.S.-Listed Bitcoin Miners Are Growing Their Share of the Network Hashrate: Bernstein

Posted on

Tether May Have to Sell Some Reserves to Comply With U.S. Stablecoin Rules: JPMorgan

USDT issuer Tether could face challenges if proposed U.S. stablecoin regulation is passed, and the company may have to sell some of its reserves to comply with the new rules, Wall Street bank JPMorgan (JPM) said in a research report Wednesday.

The Senate’s Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act mandates federal regulation for stablecoins with a market cap of over $10 billion, the report noted, with the potential for state regulation if it aligns with federal rules. The House of Representatives STABLE Act calls for state regulation without any conditions.

“Reserve requirements under the STABLE Act are stricter, allowing insured deposits, U.S. T-bills, treasury short-term repo and central banks reserves,” analysts led by Nikolaos Panigirtzoglou wrote, adding that the Senate bill also permits money market funds and reverse repos.

“Both bills allow only high quality and liquid assets as reserves,” the authors wrote.

Tether dominates the stablecoin universe with a 60% market share. USDT has a market cap of about $142 billion. JPMorgan said the issuer’s reserves are “only 66% compliant under the STABLE Act and 83% under the GENIUS Act,” citing the company’s reports.

Furthermore, “both figures suggest a declining compliance ratio since the middle of last year as stablecoin supply surged,” the bank added.

Under the proposed regulations, Tether would have to replace non-compliant assets with compliant ones, the report said. This implies “sales of their non-compliant assets (such as precious metals, bitcoin (BTC), corporate paper, secured loans and other investments) and purchases of compliant assets such as T-bills.”

“Tether is closely monitoring the evolution of the different U.S. stablecoin bills and also actively engaging with local regulators. Consultation from the industry needs to happen and it’s still unclear which bill will move forward,” a Tether spokesperson said in emailed comments.

“Even in the most extreme scenario, JPMorgan discounts the fact the Tether’s Group equity is over $20 billion in other very liquid assets and is generating more than $1.2 billion in profits per quarter through U.S. Treasuries. Adapting new requirements will be straightforward,” the person added.

Tether CEO Paolo Ardoino said in a tweet on X on Thursday following publication of the bank’s report that “JPM analysts are salty because they don’t own bitcoin.”

New rules calling for increased transparency and more frequent reserve audits could also pose further challenges for Tether, the report added.

Read more: Stablecoin Regulations Could Pose Problems for Tether, JPMorgan Says; USDT Issuer Claims Sour Grapes

Posted on

Tether May Have to Sell Some Reserves to Comply With U.S. Stablecoin Rules: JPMorgan

USDT issuer Tether could face challenges if proposed U.S. stablecoin regulation is passed, and the company may have to sell some of its reserves to comply with the new rules, Wall Street bank JPMorgan (JPM) said in a research report Wednesday.

The Senate’s Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act mandates federal regulation for stablecoins with a market cap of over $10 billion, the report noted, with the potential for state regulation if it aligns with federal rules. The House of Representatives STABLE Act calls for state regulation without any conditions.

“Reserve requirements under the STABLE Act are stricter, allowing insured deposits, U.S. T-bills, treasury short-term repo and central banks reserves,” analysts led by Nikolaos Panigirtzoglou wrote, adding that the Senate bill also permits money market funds and reverse repos.

“Both bills allow only high quality and liquid assets as reserves,” the authors wrote.

Tether dominates the stablecoin universe with a 60% market share. USDT has a market cap of about $142 billion. JPMorgan said the issuer’s reserves are “only 66% compliant under the STABLE Act and 83% under the GENIUS Act,” citing the company’s reports.

Furthermore, “both figures suggest a declining compliance ratio since the middle of last year as stablecoin supply surged,” the bank added.

Under the proposed regulations, Tether would have to replace non-compliant assets with compliant ones, the report said. This implies “sales of their non-compliant assets (such as precious metals, bitcoin (BTC), corporate paper, secured loans and other investments) and purchases of compliant assets such as T-bills.”

“Tether is closely monitoring the evolution of the different U.S. stablecoin bills and also actively engaging with local regulators. Consultation from the industry needs to happen and it’s still unclear which bill will move forward,” a Tether spokesperson said in emailed comments.

“Even in the most extreme scenario, JPMorgan discounts the fact the Tether’s Group equity is over $20 billion in other very liquid assets and is generating more than $1.2 billion in profits per quarter through U.S. Treasuries. Adapting new requirements will be straightforward,” the person added.

Tether CEO Paolo Ardoino said in a tweet on X on Thursday following publication of the bank’s report that “JPM analysts are salty because they don’t own bitcoin.”

New rules calling for increased transparency and more frequent reserve audits could also pose further challenges for Tether, the report added.

Read more: Stablecoin Regulations Could Pose Problems for Tether, JPMorgan Says; USDT Issuer Claims Sour Grapes

Posted on

Booming Crypto Trading Powers Robinhood Earnings Beat, Analysts Raise Targets

Robinhood (HOOD) shares surged in pre-market activity Thursday after the popular trading app reported fourth-quarter earnings that beat Wall Street estimates driven by a massive jump in crypto revenue.

The company reported $358 million in crypto transaction revenue in the quarter, the highest contribution from digital-asset trading to date, Wall Street bank JPMorgan (JPM) said in a research report Wednesday.

JPMorgan raised its price target for the stock to $45 from $39, while maintaining its neutral rating. Citi (C) raised its target to $60 from $45 and kept its neutral rating on the stock. Broker Bernstein more than doubled it price objective to $105 from $51 and kept an outperform rating on the shares.

The stock jumped 13% to $63.20 in early trading Thursday following results, released after the market closed on Wednesdy.

Robinhood said fourth-quarter revenue rose 115% from the previous year to $1.01 billion, beating Wall Street analysts’ estimate of $945.8 million, according to FactSet data. Transaction-based earnings increased 200% year-on-year, mainly due to a 700% rise in cryptocurrency revenue.

Crypto revenue normally contributes 10%-20% of total revenue, JPMorgan noted. The 46% jump in total cryptocurrency market cap in the period and the increase in Robinhood notional volumes, which were 393% higher quarter-on-quarter, fueled the revenue beat.

The company has big plans for its crypto business. “Management seeks to add more tokens, strengthen its wallet offering, add an order book with exchange routing functionality, integrate Bitstamp and explore tokenization longer-term,” the report said.

Robinhood has benefitted from favorable trends since the start of the year, with “crypto market tailwinds and retail activity remaining strong,” Citi said.

If this positive backdrop is maintained, the shares are likely to see support, but investors should expect volatility. While the bank has become more positive on the company’s fundamental outlook, it said it preferred to wait for a “more reasonable entry point.”

Bernstein reiterated that Robinhood was the best idea in the broker’s global digital assets coverage. It said it expected continued momentum in the first quarter “driven by crypto volatility and a sustained price cycle.”

Read more: Robinhood’s Big Earnings Beat Could Bode Well for Coinbase

Posted on

Crypto Ecosystem Growth Slowed in January Even as Total Market Cap Rose, JPMorgan Says

Crypto ecosystem growth slowed in January, with total trading volume dropping 24%, Wall Street bank JPMorgan (JPM) said in a research report Tuesday citing TradingView data.

Still, the activity is double the level before the U.S. election in November and the total market cap increased 8% to roughly $3.4 trillion, the report said. The market cap growth was concentrated in bitcoin (BTC), solana (SOL) and XRP, while “declines in average daily volume (ADV) were broad-based across the ecosystem,” the bank said.

“We think the election was a catalyst for sure, and activity and token price levels are finding their equilibrium in the post-election period,” analysts led by Kenneth Worthington wrote.

Decentralized finance (DeFi) and non-fungible tokens (NFTs) fared worse on a monthly basis the report said, with a larger deterioration across a number of metrics.

There has been some progress on the regulatory front.

The new Trump administration established a new crypto taskforce and SAB 121, a controversial accounting rule, was rescinded, JPMorgan said.

Read more: Equities-Crypto Relationship Is Likely to Weaken in the Long Term, Citi Says

Posted on

Ethereum Faces ‘Intense’ Competition From Other Networks: JPMorgan

Ether (ETH) has underperformed other cryptocurrencies in recent months as the Ethereum blockchain has faced “intense” competition from other networks, Wall Street bank JPMorgan (JPM) said in a research report on Wednesday.

The token lacks a compelling narrative like that of its larger peer bitcoin (BTC, the bank said, adding that bitcoin benefits from its perception as a store of value and as digital gold.

Despite upgrades, such as Dencun, activity has shifted from the main Ethereum network to its layer 2’s, which is detrimental to the blockchain’s growth, the report said. The network’s latest upgrade, Pectra, is likely to happen in early April.

“Competitive pressures have led some decentralized applications (dapps) to migrate from Ethereum to other application-specific chains for better performance,” analysts led by Nikolaos Panigirtzoglou wrote.

Examples include decentralized exchanges (DEXs) such as Uniswap, dYdX and Hyperliquid, the bank said.

Uniswap’s upcoming move to Unichain is important because it is one of Ethereum’s “largest gas consuming protocols,” and its migration could result in a significant loss to the network’s fee pool, the bank noted.

JPMorgan said this trend of dapps moving to other layer 2s or alternative layer 1s could negatively impact Ethereum by lessening activity on the main network, which could result in lower transaction fees and validator revenue.

Layers 2s are separate blockchains built on top of layer 1s, or the base layer, that reduce bottlenecks with scaling and data. In terms of supply, this could make ether inflationary as “fewer transactions imply reduced token burning,” the authors wrote.

The bank noted that Ethereum’s growth is behind that of competitors such as Solana, which saw a surge in activity linked to memecoins.

The Ethereum ecosystem still dominates the stablecoin, decentralized finance (DeFi) and tokenization spaces in spite of these challenges, the bank said.

The network could see increased institutional demand from tokenization enterprises but “competition from other networks is likely to remain intense in the foreseeable future,” the report added.

Read more: How to Fix Ethereum’s Fragmentation Problem

Posted on

Bitcoin Network Hashrate Growth Was Muted in January: JPMorgan

The Bitcoin network hashrate, a proxy for competition in the industry and mining difficulty, rose slightly in January, Wall Street bank JPMorgan (JPM) said in a research report on Monday.

The monthly average network hashrate rose 1% to 785 exahashes per second (EH/s), the bank noted, while mining difficulty fell 2% month-on-month.

The month-end, weekly moving average hashrate was 781 EH/s, a 2% decline from the end of December, the report said.

“This is relatively uncommon, and a modest tailwind for bitcoin (BTC) mining economics,” analysts Reginald Smith and Charles Pearce wrote, adding that network difficulty remains 25% higher than before the halving event last April.

According to a CoinDesk report from Tuesday, Bitcoin’s 7-day moving average hashrate hit an all-time high of 833 exahashes per second (EH/s).

Mining profitability also inched higher in January. The bank estimated that miners earned an average of $57,200 per EH/s in daily block reward revenue, an increase of less than 1% from December.

The total market cap of the bitcoin miners that the bank tracks rose 5% from the month previous.

Cipher Mining (CIFR) and Riot Platforms (RIOT) outperformed, gaining 23% and 16% respectively, after announcing high performance computing (HPC) related news.

TeraWulf (WULF) underperformed in January, with the shares dropping 16%.

Read more: Bitcoin Miners Bitdeer, CleanSpark, Core Scientific Initiated at Outperform by KBW

Posted on

Crypto Venture Capital Funding to Rise This Year, Won’t Hit Previous Highs: JPMorgan

Crypto venture capital (VC) funding is expected to recover this year as regulatory clarity and more crypto-friendly policies emerge during the tenure of President Donald Trump, JPMorgan (JPM) said in a research report Wednesday.

The Wall Street bank noted that venture funding for the industry has been subdued in recent years. This may have been due to enforcement actions by the U.S. Securities and Exchange Commission (SEC) and the climate of regulatory uncertainty during the previous administration, analysts led by Nikolaos Panigirtzoglou wrote.

The start of the EU’s Markets in Crypto Assets (MiCA) regulations, which came into force at the end of December, is expected to “further bolster VC engagement,” the report said.

Still, the level of funding is unlikely to match previous peaks seen in 2021/22, JPMorgan said, as crypto venture capital firms face a number of challenges.

Giants of traditional finance (TradFi) such as Blackrock (BLK) and Franklin Templeton are increasing their participation in the crypto market, and this leaves less market share for VC firms in stablecoins, tokenization and decentralized finance (DeFi), the bank said.

Nascent crypto projects are avoiding large token sales to VCs and are increasingly turning to community-driven platforms to raise money, the report noted.

High interest rates also present a challenge for VC funding, JPMorgan said.

The growth of cryptocurrency exchange-traded fund (ETF) products is “inducing a trend towards passive investing,” and this could be diverting capital away from VC firms, the report added.

Read more: Crypto Venture Capital Market Remained Difficult in 2024, Galaxy Digital Says

Posted on

Bitcoin Miners Have Started 2025 on a Strong Footing, JPMorgan Says

Bitcoin (BTC) mining stocks tracked by JPMorgan have enjoyed a strong start to the year, with 12 of the 14 companies outperforming the world’s largest cryptocurrency in the first two weeks, the Wall Street bank said in a research report Thursday.

The network hashrate has risen 2% month-to-date to an average of 793 exahashes per second (EH/s) and is 51% higher than a year ago, the report said.

The hashrate refers to the total combined computational power used to mine and process transactions on a proof-of-work blockchain and is a proxy for competition in the industry and mining difficulty.

The hashprice, a measure of daily mining profitability, has dropped less than 1% since the end of December, the bank noted, as “hashrate growth outpaced BTC price movement.”

“Miners earned ~$54,900 in daily block reward revenue per EH/s over the first two weeks of January,” analysts Reginald Smith and Charles Pearce wrote, which was 2% less than last month.

The combined hashrate of the 14 U.S.-listed miners in the bank’s coverage has more than doubled in the last 12 months and now accounts for roughly 30% of the global network.

The total market cap of the mining stocks that the bank tracks has increased 16%, or $4.5 billion, in the first two weeks of the year. Riot Platforms (RIOT) outperformed, with a 32% gain, and Bitdeer underperformed, with a 4% decline.

Bitcoin has increased about 56% since the halving event in April, around 44% since the U.S. presidential election in November, and is up 134% year-on-year, the report said.

Read more: U.S.-Listed Bitcoin Miners Accounted for 25% of Global Network in December: Jefferies

Posted on

EU’s MiCA Rules Will Likely Boost Euro Denominated Stablecoins, JPMorgan Says

The EU’s MiCA regulations, which came into effect on Dec. 30, will likely boost euro denominated stablecoins, JPMorgan (JPM) said in a research report on Wednesday.

“Under MiCA, only compliant stablecoins can be used as trading pairs in regulated markets, prompting EU exchanges to adjust their offerings,” analysts led by Nikolaos Panigirtzoglou wrote.

This has resulted in compliant stablecoins such as Circle’s EURC gaining strength, whereas non-compliant stablecoins like Tether’s EURT faced challenges, the Wall Street bank said.

A stablecoin is a type of crypto designed to hold a steady value and is usually pegged to the U.S. dollar, though other currencies and commodities such as gold are also used.

Under the new rules stablecoin issuers such as Tether are required to maintain significant reserves in banks based in Europe and must secure licenses for trading, the report noted.

This has led Tether to discontinue its EURT stablecoin and has resulted in the delisting of USDT from a number of exchanges based in the EU, JPMorgan said.

The stablecoin issuer said in November that it would phase out its euro stablecoin, with users able to redeem tokens for up to 12 months.

Still, Tether remains a “dominant force” in the global stablecoin market in spite of these challenges, the bank said, adding that is widely used in Asian markets where there are less restrictions.

Tether’s investment in MiCA-compliant stablecoin issuers such as Quantoz Payments shows it commitment to maintaining a presence in the EU, the report added.

The company said in December that it had also invested in European stablecoin issuer StablR.

Read more: Tether Invests in MiCA-Compliant Stablecoin Issuer StablR

Posted on

Bitcoin Mining Profitability Rose in December for Second Month in a Row: JPMorgan

Bitcoin (BTC) miners’ daily revenue and gross profit rose for the second consecutive month in December, hitting the highest levels since April, JPMorgan (JPM) said in a research report on Monday.

Mining profitability increased as the rally in the world’s largest cryptocurrency continued to outpace network hashrate growth, the bank noted.

JPMorgan estimated that bitcoin miners earned an average of $57,100 per exahash per second (EH/s) in daily block reward revenue last month, 10% more than in November.

Still, “daily revenue and gross profit per EH/s is still 43% and 52% below pre-halving levels, respectively,” analysts Reginald Smith and Charles Pearce wrote.

The network hashrate grew by 6% in December to an average of 779 EH/s, the report said. Hashrate refers to the total combined computational power used to mine and process transactions on a proof-of-work blockchain.

Mining difficulty rose 7% from the month before and is now 27% higher than before the reward halving event in April, the bank said. The hashrate increased 54% in 2024, slower than 2023’s gain of 103%.

The total market cap of the 14 publicly listed bitcoin miners that the bank tracks declined 23% to $28 billion in December. The figure rose 52% in November.

TeraWulf (WULF) was the only miner that outperformed bitcoin last year, with a 136% gain, the report said. Bitcoin climbed about 120%.

Read more: Bitcoin Miners Are Expected to be Profitable in December, Jefferies Says

Posted on

Trump Administration Has Already Unlocked ‘New Era’ for U.S. Crypto: JPMorgan

Donald Trump’s victory in the November presidential election is already ushering in a new era for crypto in the U.S., JPMorgan (JPM) said in a report Wednesday, noting that the total cryptocurrency market cap has jumped about 65% since his reelection.

“Not only does this new administration bring a sense of crypto friendliness, but it also has shown an eagerness to promote the asset class,” analysts led by Kenneth Worthington wrote.

The incoming administration has shown a willingness to talk about crypto market regulation and about how to keep future development in the U.S., the report said, adding that the president-elect has already nominated a number of people who will take part in the formulation of crypto policy and enforcement.

This means a floor has been established, in that the “worst regulatory environment for crypto” is in the past, the report said. The ecosystem is now expected to become a “safer, more transparent, and more productive industry (from a regulatory perspective) from this point.”

Still, these positive tailwinds could take some time to have an effect. JPMorgan cautioned that the market might not see policy impacts for at least nine to 12 months into Trump’s term.

Trump’s nomination for the Commodity Futures Trading Commission (CFTC) chair is one piece missing from the administration’s pro-crypto agenda, the Wall Street bank said. The position is important because of its likely role in regulating bitcoin (BTC) and ether (ETH).

A more productive regulatory environment would lead to the listing of more tokens by exchanges and brokers, and would also encourage more product innovation, the report added.

Read more: Crypto Markets Have Benefited From a Positive Environment Since U.S. Election: Citi

Posted on

Bitcoin Mining Economics Continued to Improve in December, JPMorgan Says

Bitcoin (BTC) mining economics continued to improve this month, as the hashprice, a measure of daily profitability, rose 5% from the end of November, JPMorgan (JPM) said in a research report Monday.

The hashprice increased as the rally in the world’s largest cryptocurrency outpaced the rise in the network hashrate, the report said. The hashrate is a proxy for competition in the industry and mining difficulty.

The network hashrate has increased 6% month-to-date to an average of 773 exahashes per second (EH/s), the bank noted.

“We note miners earned about $57,300 in daily block reward revenue per EH/s over the first two weeks of December,” analysts Reginald Smith and Charles Pearce wrote, adding that this is the highest level in the last seven months, but is still about 40% below pre-halving levels.

The combined hashrate of the fourteen U.S.-listed miners the bank tracks has increased almost 94% year-to-date to 222 EH/s and now accounts for around 29% of the global network, the bank said.

The total market cap of the miners the bank tracks fell 4% or $1.5 billion, having increased more than 50% following the U.S. presidential election.

The bank estimated that the U.S.-listed miners are currently trading on about two times their proportional share of the four-year block reward opportunity.

Read more: Bitcoin Mining Profitability Improved in November, JPMorgan Says

Posted on

Miners Are Adopting the Same Bitcoin Acquisition Strategy as MicroStrategy: JPMorgan

MicroStrategy (MSTR), the software company founded by Michael Saylor, is not the only large-scale corporate buyer of bitcoin (BTC), JPMorgan (JPM) said in a Wednesday report. Crypto miners are also adopting the accumulation strategy.

The shift to building up bitcoin holdings is driven by growing pressure on profitability, which stems from the reward halving in April and a rising network hashrate, the report said. Hashrate is the total computational power used to mine and process transactions on a proof-of-work blockchain and is a proxy for competition in the industry and mining difficulty.

“This likely prompted miners to hoard or seek further investments into bitcoin or diversify into AI/HPC businesses,” analysts led by Nikolaos Panigirtzoglou wrote, referring to artificial intelligence and high-performance computing.

Miners such as MARA Holdings (MARA) have adopted a similar bitcoin-buying strategy to MicroStrategy, called BTC yield, in response to these challenges, JPMorgan said.

MARA now owns 35,000 tokens ($3.5 billion) and is the second-largest publicly listed corporation in terms of bitcoin holdings.

The miners aren’t alone. Medical-device maker Semler Scientific has also been actively buying the world’s largest cryptocurrency, and now owns $144 million worth of crypto.

January’s introduction of spot bitcoin exchange-traded funds (ETFs) in the U.S. has given institutional investors a more direct way to gain bitcoin exposure, the bank said. Shares of miners, which had been treated as a proxy for bitcoin, have underperformed as a result.

The bank noted that aside from buying more bitcoin, miners are increasingly financing their businesses via debt and equity offerings rather than selling their crypto reserves to cover operational costs.

Miners have raised more than $10 billion in equity so far this year, eclipsing the previous high of $9.5 billion in 2021, the report added.

Read more: Bitcoin Miners Cipher, CleanSpark and MARA Upgraded at JPMorgan

Posted on

Bitcoin Miners Cipher, CleanSpark and MARA Upgraded at JPMorgan

Wall Street giant JPMorgan (JPM) turned more bullish on some bitcoin (BTC) mining stocks in its coverage following third quarter results and recent gains in bitcoin price and the network hashrate, the bank said in a report on Tuesday.

The bank upgraded Cipher Mining (CIFR) and CleanSpark (CLSK) to overweight from neutral. JPMorgan also introduced a new price $8 price target for Cipher, and raised its CleanSpark price target to $17 from $10.50.

MARA Holdings (MARA) was also upgraded to neutral from underweight and raised its price target on the stock to $23 from $12.

The U.S. bank downgraded IREN (IREN) to neutral from overweight while increasing its price target on the shares to $15 from $9.50.

It raised its Riot Platforms (RIOT) price target to $16 from $9.50, while maintaining its overweight rating on the company.

The bank said it was introducing a new sum-of-the-parts (SOTP) valuation framework for the miners, which took into account company's mining operations, their respective land and power portfolios, and their hodl balance to reflect any bitcoin that the firms may hold on their balance sheet.

Cipher rose over 4% in early trading Tuesday, CleanSpark gained around 3.5%, MARA climbed over 2%, RIOT was almost 2% higher, and IREN was 0.4% better.

Read more: <a href="https://www.coindesk.com/markets/2024/12/02/bitcoin-mining-profitability-improved-in-november-jp-morgan-says" target="_blank">Bitcoin Mining Profitability Improved in November, JPMorgan Says</a>