Opinion by: Fakhul Miah, Managing Director of Gomining Institutional
The Bitcoin Mining industry (BTC) has never been more attractive -attractive to institutional investors. Fintech giant invests in Bitcoin mining instead of simply accumulating the owner, all thanks to the desirable environment of the US regulation and the profitability of BTC.
Then, many companies vary by providing the power of computing to AI, further strengthening their economy and, thus, being attractive -investment. So far, it looks like the future of the foundational layer for the Bitcoin network can mark the new gusher age.
Is Bitcoin mining visible?
Bitcoin mining is still profitable. Coinshares, a digital asset investment firm, shared that the average cost of 1 BTC mine for US-listed miners reached $ 55,950 in Q3 2024. Two other popular models-one from Macromicro and another called Glassnode regression regression-provide different estimates.
On the very day of February 20, macromicro.me Data The average cost to produce 1 BTC hovers is shown above $ 92,000; Glassnode regression poverty estimates the cost of the mine of a single BTC of approximately $ 34,400, while cryptocurrency prices hit $ 98,300 that day.
In a global size, mining costs differ based on the region. For example, the cost of electricity to produce 1 BTC in Ireland is approximately $ 321,000, but only costs $ 1,300 at 1 BTC mine in Iran. Electricity is just part of the equation – hardware, labor and maintenance costs also play an important role.
Recent data from coinshares and macromicro.me have painted a challenging but that -nuced picture for Bitcoin miners in the United States. While some institutional miners remain profitable, the broader view shows increasing operating pressure that can recharge the mining industry.
What happens if the challenges are not addressed? Mining institutions with high rates of profitability can begin to expand their operations and possibly obtain poor miners at bargain prices, which potentially place retail and smaller miners at risk.
Sustainable Economics for being attractive -Investment
In addition to receiving block rewards, miners also benefit from bitcoin network transaction fees, which depend on network use. Data shows that the sun -sun transaction fees in Bitcoin walk between $ 360,000 and $ 1.3 million over the last month -reaching an average of $ 595,000 days -day.
Further streaming the bolsters income of the Bitcoin mining mining appeal and strengthened the stability of the mining business model by varying -the resources of income.
Recently: Bitcoin Miner Bitfarms gets up to $ 300m loan from Macquarie
Hardware mining is not just mining. High computational power, captive power supplies and ready infrastructure make miners unique equipment to support AI and high-performance computing. In simple terms, mining companies can now rent their hardware to process AI activities instead of just dedicated to Bitcoin mining.
The combination of income growth in revenue and varying AI computing creates a more resilient and vibrant industry model (the existing one is not yet very appealing to institutional investments in the US).
Institution investments in increasing
The appealing income in Bitcoin mining industries has brought great attention from institutional investors. This process is easy to see: Bitcoin mining pools in the US cost more than 40% of the hashrate of the global Bitcoin network in 2024.
According to Research Through ey-parthenon and coinbase, 83% of 352 global institutions plan to increase their crypto allocations this year, while 51% of asset managers are considering investments in digital asset companies, including mining companies. That's why I'm not surprised to witness huge investment on riot platforms, coreweave and other mining industry players.
The desired market sentiment has prepared a way for more public offering (IPO) and specialized funds targeting mining companies. In addition to securing $ 650-million investment, Coreweave aims to go public with a $ 4-billion IPO to help the company supported by Nvidia to reach a $ 35-billion appreciation.
BGIN Blockchain, a Singapore -based crypto manufacturer, recently filed to go public to the US. The Renaissance Capital, a firm advisory firm, hopes the BGIN Blockchain will raise $ 50 million for its IPO.
This advancing in the institution's momentum is set to benefit the Bitcoin mining industry by driving demand and tightening available market supply. As more large players accumulate and handle Bitcoin, market deficiency may increase, supporting higher prices and, in turn, strengthening the miner's profitability.
Future optimism is more than tangible
Strong support from institutional investors came as optimization around crypto policies would significantly increase after Donald Trump won the US presidency election in November 2024.
The establishment of a strategic Bitcoin reserve in early March, seen as a massive policy shift, which contributed to the positivity to the crypto and mining sectors. This sector gained importance. Last year, bitcoin mining operations significantly contributed to the US economy, making up nearly $ 4.1 billion in gross domestic product and creating more than 31,000 jobs nationwide. The industry is renewing rural areas by developing tax revenue and repurosing of remote locations for mining operations. It was like the beautiful days of the oil industry a century ago, right?
The latest investment, leadership appointments and IPOs show that bitcoin mining companies have a significant tail. Meanwhile, they are no longer about the BTC – they are becoming data infrastructure providers for the AI sector, which becomes giant hybrid data processing.
Interpreting this change, the US may be the leader in the digital asset and bitcoin mining space due to the Trump's pro-crypto stance and to fulfill the stated goal of becoming the “crypto capital of the world.”
While institutions doubled in Bitcoin mining and AI accumulation, the question is not whether this industry will change but who will lead the charge. The modern digital gold rush is carried out, and the wisest capital is claimed.
Opinion by: Fakhul Miah, Managing Director of the Gomining Institutional.
This article is for general information purposes and is not intended to be and should not be done as legal or investment advice. The views, attitudes, and opinions expressed here are unique and do not necessarily reflect or represent the views and opinions of the cointelegraph.
