JPMorgan (NYSE:JPM) estimates that the current cost of mining Bitcoin (available on Coinbase) has dropped to around $45,000, down from over $50,000. This decrease follows the quadrennial halving event last month, which cut miner rewards by 50%.

The hashrate, which measures the total combined computational power used for mining and processing transactions on the Bitcoin (available on Coinbase) network, did not immediately fall post-halving as expected. According to JPMorgan, this delay was due to the launch of the Runes protocol, a new form of token creation that temporarily spiked transaction fees, boosting miner revenue and offsetting the reduced issuance rewards from the halving.

“This provided a temporary boost to miner revenue in the immediate aftermath of Bitcoin (available on Coinbase) halving,” analysts led by Nikolaos Panigirtzoglou wrote. However, the report noted that the increase in fees was short-lived, with user activity and fees dropping significantly in recent weeks. This decline highlights the ongoing challenge for Bitcoin (available on Coinbase) miners to maintain sustainable revenue, particularly in the post-halving environment.

As the Runes hype faded, network power consumption fell more than the hashrate, indicating that unprofitable miners with inefficient rigs have exited the network. The report explains that there’s a feedback loop with Bitcoin (available on Coinbase) prices: as prices decline, more unprofitable miners are pressured to leave the network, leading to a larger drop in hashrate and mining costs.

JPMorgan does not foresee any near-term upside for Bitcoin (available on Coinbase) prices due to several headwinds, including the lack of positive catalysts and diminishing retail interest.

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