- A report by Galaxy Digital reflects on 2022 and the path ahead for miners.
- Investors are looking to invest up to $1.1 billion in the hosting and mining business in 2023.
- The Lightning Network may see more use this year as miners explore ways to earn additional revenue.
Galaxy Digital CEO Mike Novogratz has a bleak outlook for bitcoin miners in 2023. According to a report from the New York-based cryptocurrency investment firm, financing will be tough for companies involved in mining and hosting.
A series of bankruptcies and scandals accompanied by a record high in energy prices and network hash rate has made 2022 the perfect storm for bitcoin miners, says Galaxy Digital. Growth became a secondary priority as survival took center stage. The problems that plagued 2022, including a discouraging regulatory environment and an ever-increasing FUD, will continue into 2023.
According to the report, publicly traded miners defaulted 11.59 EH of the hash rate through ASIC-backed loans in 2022. Defaults may have helped preserve liquidity but have eroded investor confidence in the mining sector. The report stated that “miners will not have the same access to financing through the capital markets in 2023 as they did in 2021 and early 2022.”
However, another source…
Post-2023 will not be easy for bitcoin miners: Galaxy Digital debuts Coin Edition.