Executives from prominent mining and manufacturing firms believe market forces resulting from the fourth Bitcoin halving scheduled in 2024 could force the price of BTC past $100,000.
Cointelegraph Magazine editor Andrew Fenton spoke to Canaan vice president Davis Hui following a panel discussion at Canaan’s Avalon Bitcoin and Crypto Day (ABCD) in Singapore.
Hui and a panel that included Bitcoin mining ecosystem executives from Singapore, Kazakhstan and the United Arab Emirates, all offered BTC price predictions around $100,000 in 2024 resulting from the effects of the latest Bitcoin mining reward halving.
Hui told Cointelegraph that the supply of Bitcoin would be drastically reduced with the reward halving down to 6.25 BTC per block, while traditional finance institutions are showing increased interest in investing in the sector:
“What about BlackRock, they’re holding onto $10 trillion of assets under management. The overall cryptocurrency market cap is $2 trillion – they have five times more than that.”
The Canaan VP said his prediction was heavily influenced on the outcome of a number of Bitcoin exchange-traded fund applications lodged with the U.S. SEC by some of the world’s largest asset managers.
“This money will come in, the BTC demand will increase while the supply has decreased and the price will increase.”
Hui also noted that it had become difficult for most miners to continue operating in highly competitive market conditions, with all time hash rates and network difficulties directly eating into miner profitability.
Those that could not cover electricity costs with the Bitcoin mining rewards earned will simply shut off those machines, while those that continue operating will do so with a view of the potential upside ahead of the 2024 halving, he said.
Miners that are able to upgrade to more efficient and powerful machines are able to maintain better profitability, he said. Hui predicts that mining companies in the U.S. might be particularly hard pressed, given high electricity and administrative costs.
Hui also conceded that Canaan was among industry companies to have reported a financial loss in the first quarter of 2023, highlighting the impact of a prolonged cryptocurrency bear market.