Year of Bitcoin miners’ merge? Analysts predict key mining trends for 2023

After a shocking year for Bitcoin (BTC), public miners will focus on strengthening their balance sheets and minimizing costs this year, according to industry analysts.

Hashrate Index Bitcoin analysts Jaran Mellerud and Colin Harper say public miners are likely to go private or merge with other companies in 2023 due to minimizing Bitcoin mining costs. . predicted.

In a blog post titled “10 Bitcoin Mining Predictions for 2023,” analysts noted that public miners are subject to stringent reporting requirements, including spending millions on annual reporting.

After many Bitcoin mining stocks plummet by 90% in 2022, public miners can go private or merge with other companies to share the costs, significantly reducing their administrative costs.

Along with predicting 2023 to be the year of mergers for Bitcoin miners, Hash Rate Index predicts the year of major restructuring in the Bitcoin mining industry. Analysts believe strengthening balance sheets will be a top priority for Bitcoin miners in 2023 as they fight to avoid bankruptcy.

Analysts have pointed out that the unsustainable debt levels of some Bitcoin miners will force them to pursue debt restructuring as their only option. Debt restructuring could mean negotiating lower interest rates or extending debt maturities, the authors added.

Bitcoin miners will also increasingly hedge their risks by using Bitcoin mining derivatives in 2023, according to analysts. This includes allowing miners to sell future hashrates at a specific hash price. “We will start to see a tendency for miners to hedge everything that can be hedged, much like we would expect in a more mature commodity-producing industry,” Mellerud and Harper said.

In a broader industry prediction, the Hash Rate Index also predicts that the ongoing Bitcoin bear market will likely end in 2023. refer To the past BTC price cycle. But a full-blown bull market won’t start until traditional financial firms are ready to move to Bitcoin, which analysts say will take another year or two.

Bitcoin hashrate growth is also likely to slow in 2023, with mining equipment becoming even cheaper, analysts predict.

Related: Bitcoin miners have had mixed success in dealing with the crisis of debt-fueled over-expansion

The Hash Rate Index’s Bitcoin mining predictions come amidst a major crisis in the cryptocurrency mining industry as Bitcoin loses approximately 60% of its value in 2022. 100% of public mining companies have been forced to sell almost all of the cryptocurrencies they have mined. In 2022, to survive the crypto winter.