After a shocking year for Bitcoin (BTC), public miners will focus on strengthening balance sheets and minimizing costs this year, according to industry analysts.
Minimizing Bitcoin mining costs will likely lead to public miners going private or merging with other companies by 2023, Hash Rate Index Bitcoin analysts Jaran Mellerud and Colin Harper. foretold.
In a blog post titled "10 Bitcoin Mining Predictions for 2023," analysts noted that public miners are overwhelmed with strict reporting requirements, such as spending millions of dollars on annual reports.
after many Bitcoin mining stocks plummeted 90% in 2022, public miners could significantly reduce administrative costs by going private or merging with others to share the costs.
In addition to predicting that 2023 will become the year of the Bitcoin miner meltdown, Hash Rate Index also predicted a year of massive restructuring in the Bitcoin mining industry. Analysts are confident that strengthening balance sheets will be a priority for Bitcoin miners in 2023 as they fight to avoid bankruptcy.
Analysts noted that the unsustainable debt levels of some Bitcoin miners will force them to proceed with debt restructuring as the only option. Debt restructuring may involve negotiating lower interest rates or extending debt maturity dates, the authors added.
According to analysts, Bitcoin miners will also increasingly hedge risks in 2023 by utilizing Bitcoin mining derivatives, including those that allow miners to sell their future hash rate for a specified hash price. “We will see the start of a trend of miners looking to hedge everything that can be hedged, as is expected in more mature commodity-producing industries,” Mellerud and Harper stated.
As for broader industry predictions, Hash Rate Index also predicted that the current Bitcoin bear market will likely come to an end in 2023. Referrer to historical BTC price cycles. However, a full-scale bull market won't start until traditional financial firms are ready to move to Bitcoin, which would take another year or two, analysts say.
Bitcoin hash rate growth is also likely to slow in 2023, while mining equipment will be even cheaperanalysts predicted.
Related: Bitcoin miners see mixed success in tackling debt-fueled overexpansion crisis
Hash Rate Index Bitcoin Mining Predictions Comes Amid Crypto Mining Industry Going Through Major Crisis Fueled By Bitcoin loses around 60% of value in 2022. Up to 100% of public mining companies have been forced to sell almost all cryptocurrencies that they mined in 2022 to survive the crypto winter.
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