The Bitcoin halving is approaching, whose stock price will decline?
Halving means that Bitcoin mining companies will receive fewer Bitcoins, leading to a decrease in their operating income. Will the stock price therefore decline? Halving may have a temporary impact on Bitcoin mining companies at most, but the most important factor is still the price of Bitcoin!
Zhitong App has learned that the Bitcoin halving is expected to occur in April 2024, which typically leads to a higher Bitcoin price in the following months. But what impact will this event have on Bitcoin mining companies? The halving means that these companies will receive fewer Bitcoins, resulting in a decrease in their operational revenue. Does this mean that the stock prices of Bitcoin mining companies will decline due to the Bitcoin halving?
Looking back at the last Bitcoin halving on May 11, 2020, we can see significant differences in the performance of popular Bitcoin mining companies in the 150 days after the halving: Marathon Digital (MARA.US) and Riot Platforms (RIOT.US) both saw substantial returns, while Bitfarms (BITF.US) and Hut 8 (HUT.US) experienced declines.
In fact, it is challenging to assess the extent of the impact of the Bitcoin halving on the stock prices of Bitcoin mining companies because there are many factors to consider, including broader market developments, performance reports, and more. Additionally, investors may have already priced in the halving effect on the stock prices of Bitcoin mining companies.
The halving may have a temporary impact on Bitcoin mining companies at most, with the most crucial factor still being the price of Bitcoin. If the price of Bitcoin continues to rise, the halving may not be significant because these mining companies' future revenue could still be much higher.
For investors, the unpredictable nature of Bitcoin's trend remains the most significant risk. While investors are optimistic about Bitcoin's future prospects, government regulations and user acceptance will ultimately determine the future price of Bitcoin.