Crypto mining is one of the main methods by which individuals can acquire cryptocurrencies like Bitcoin (BTC), as they earn rewards for confirming transactions and securing the network. However, if the price of the maiden digital asset drops significantly, it might become less profitable to mine it.
According to Frank Holmes, CEO of investment firm U.S. Global Investors, the threshold price below which Bitcoin miners could halt their operations is $12,000, as this is the break-even when they become unprofitable, he said in an interview with the finance media outlet Benzinga streamed on October 19.
Holmes, who earlier this year projected that Bitcoin could outperform gold thanks to millennials’ involvement, challenging the precious metal’s status as a store of value, opined that:
“Globally, right now it’s basically implied that you’re going to have to have like $12k, everyone starts shutting down, the average person starts shutting down [their mining machines].”
Meanwhile, the flagship digital asset’s price at press time stood at $19,139, recording a drop of 0.45% over the past 24 hours, but an increase of 0.65% over the week, according to CoinMarketCap data.
Although Bitcoin’s bulls and bears have been battling for momentum while the asset has been struggling to reach the psychological level of $20,000, its miners have remained unconcerned, as evidenced by the mining hash rate reaching a new all-time high (ATH) in early October.
However, if the darkest predictions come true, it could spell disaster for crypto miners, especially in light of the European Union proposing a new law that seeks to establish energy efficiency labels for assets like Bitcoin as part of containing energy consumption in the sector.
Interestingly, a quarterly study has found that Bitcoin mining only consumes 0.16% of global energy production, as well as accounts for 0.1% of the world’s CO2 production, despite critics focusing on its negative impact on the environment, as Finbold reported.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
Watch the entire video below:
Check your inbox or spam folder to confirm your subscription.
Copyright © 2022 FINODES LLC. All rights reserved. Use of this site constitutes acceptance of our Terms of Service.
WARNING: The content on this site should not be considered investment advice. Investing is speculative. When investing your capital is at risk. This site is not intended for use in jurisdictions in which the trading or investments described are prohibited and should only be used by such persons and in such ways as are legally permitted. Your investment may not qualify for investor protection in your country or state of residence, so please conduct your own due diligence. This website is free for you to use but we may receive commission from the companies we feature on this site.