The upcoming Bitcoin halving event, which will reduce miner rewards by 50%, may incentivize some U.S. miners to relocate overseas to capitalize on cheaper electricity.
The next halving is expected on April 24th, per crypto news outlets. In the 2020 halving, with Bitcoin at $8,750, the price surged about 430% afterwards.
Analyst Jaran Mellerud warns of a potential “bloodbath” for miners if Bitcoin’s price doesn’t rise substantially post-halving, as many high-cost U.S. operations would become unprofitable. Inefficient mining firms paying high hosting fees would be impacted most.
According to Mellerud, countries like Ethiopia could become prime destinations for migrating miners. He believes regions in Africa and Latin America, especially Paraguay and Argentina, may claim a bigger share of Bitcoin’s hash rate in coming years.
Nonetheless, the prospects of a mining exodus exemplify electricity pricing’s influence on Bitcoin mining. With the looming halving likely to raise costs, identifying cheaper power sources could reshape the geographic makeup of Bitcoin’s hash rate.
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