beehiiv-import

⚡Mining Profitability Hits Record Lows🔅

Croxroad

20 Aug 2024 — 4 min read

☕️ GM Dear Plebs!

Here is Crox Road, your daily dose of orange pill that will turn you into a Bitcoin Maxi.

The menu for today:

⛏️ Bitcoin Network Hashrate Rises

Bitcoin mining stocks experienced a notable pullback in August as the rise in network hashrate pushed mining profitability to historic lows, according to JPMorgan's latest research report. In the first two weeks of the month, the combined market cap of the fourteen U.S.-listed mining companies tracked by the bank dropped by 18% since late July. This decline is attributed to an increased hashrate, which now averages around 621 exahashes per second (EH/s)—a 1% gain from earlier in the month but still 30 EH/s short of pre-halving levels. Despite this, mining stocks remain trading at twice their proportional share of the four-year block reward.

On a positive note, U.S.-listed miners have seen their share of the Bitcoin network hashrate climb to a new record high of 26%, marking the fourth consecutive month of growth in this area. However, the increase in hashrate has contributed to a significant drop in hash price, a key measure of mining profitability, which is currently about 30% lower than December 2022 levels and roughly 40% below pre-halving figures. This downturn in hash price could potentially hinder further growth in hashrate in the near term.

Bitcoin's price has decreased approximately 5% since the halving event, yet it remains 35% higher year-to-date and 104% higher compared to the same period last year. Despite the challenges faced by mining profitability, the overall market sentiment for Bitcoin remains strong, bolstered by its substantial year-on-year gains.

🔙 NYSE and Nasdaq Backtrack

Nasdaq and the New York Stock Exchange (NYSE) have withdrawn their applications to list and trade options on two U.S. spot Bitcoin ETFs, according to recent filings with the Securities and Exchange Commission (SEC). The NYSE's withdrawal, announced on August 14, concerned its proposal to list options on the Bitwise Bitcoin ETF (BITB) and the Grayscale Bitcoin Trust (GBTC). This proposal had been under review since its initial public comment period began in February, with the SEC extending its review in April and July. Similarly, Nasdaq followed suit on August 15 with its own withdrawal, which was initially published for comment in March and had formal proceedings initiated by the SEC in April.

Bloomberg analyst James Seyffart has suggested that both Nasdaq and the NYSE are likely to re-file their applications in the near future, similar to the recent move by CBOE, which also withdrew its application earlier this month. Seyffart noted that the CBOE's refiled application included more detailed information, but cautioned that it is uncertain whether the SEC is actively engaging with CBOE on this matter. The refiled applications may extend the review process, potentially pushing deadlines back to late April 2025.

In related developments, Bitcoin ETF flows experienced a shift to positive on Thursday following net outflows the previous day. Data from Farside Investors indicated that outflows from the Grayscale Bitcoin Trust decreased to $25 million, while the Grayscale Bitcoin Mini Trust saw an inflow of $13.7 million after two days of neutral flows. This trend reflects ongoing investor interest despite regulatory uncertainties.

☑️ Can You Withdraw From a Crypto IRA?

Yes, you can withdraw cryptocurrency from a crypto IRA, but the process follows the same tax rules as any other IRA. In a Traditional IRA, withdrawals are taxed as ordinary income, while in a Roth IRA, withdrawals are tax-free if certain conditions are met. However, early withdrawals from either type before age 59½ may result in additional taxes and penalties.

🤣 Crox Road Memes

“May your Bitcoin decisions reflect your vision for the future, not the fear of the present.”

Step into the world of cryptocurrency with the Bitcoin Genesis Mug, a bold tribute to the revolutionary moment that started it all. This exquisite piece of ceramic craftsmanship is more than just a mug; it's a symbol of the pioneering spirit that launched Bitcoin into the stratosphere. Every sip from this elegant vessel is a nod to the audacious vision of Satoshi Nakamoto and the birth of a financial revolution that continues to reshape the world.