JPMorgan recently reported that the combined hashrate of the publicly listed bitcoin mining stocks it monitors has reached a new high, accounting for 28.9% of the network hashrate.
The bank highlighted that the network hashrate has seen a 4% increase this month, alongside a slight uptick in mining profitability.
According to the report, there may be a promising trading opportunity in mining stocks leading up to the U.S. election.
The aggregated hashrate of the fourteen U.S.-listed bitcoin mining stocks under JPMorgan’s watch has surged to 28.9% of the network hashrate, marking a significant milestone in the industry. Analysts Reginald Smith and Charles Pearce emphasized that these miners have seen a substantial 70% growth in hashrate this year, now totaling 194 EH/s.
“The combined hashrate of the 14 U.S.-listed miners we track has increased ~70% year-to-date (80 EH/s) to 194 EH/s, versus a 33% increase in the network hashrate, and today accounts for a record ~28.9% of the global network hashrate,” Smith and Pearce stated in their report.
This increase in hashrate since the bitcoin halving event earlier this year reflects the operational efficiency and financial advantages of these publicly traded mining companies, as noted by JPMorgan.
In addition, the bank observed a 4% rise in the network hashrate this month, averaging at 672 EH/s. Hashrate represents the total computational power used for mining and processing transactions on a proof-of-work blockchain. Despite this growth, the hashprice, which measures daily mining profitability, has seen a marginal increase of less than 1% since September.
The market capitalization of the mining stocks covered by JPMorgan has climbed 7% since the end of September. Currently trading at 1.9 times their share of the four-year block reward, this level is the lowest since May, potentially offering an attractive entry point for investors leading up to the election.
October saw a rally in mining stocks, particularly in the first two weeks, fueled by bitcoin’s price surge and increased interest from hyperscalers in companies with high performance computing exposure. Greenidge Generation (GREE) outperformed the sector with a 29% gain, while Stronghold (SDIG) saw a 17% decline.
On the contrary, rival bank Jefferies cautioned that October could present challenges for the mining sector in a report released last Sunday.
Read more: Bitcoin Mining Profitability Fell in September, Jefferies Says