{"id":20213,"date":"2025-01-10T18:08:43","date_gmt":"2025-01-10T16:08:43","guid":{"rendered":"https:\/\/forklog.com\/en\/fidelity-analysts-see-no-long-term-threat-to-bitcoin-mining\/"},"modified":"2025-01-10T18:08:43","modified_gmt":"2025-01-10T16:08:43","slug":"fidelity-analysts-see-no-long-term-threat-to-bitcoin-mining","status":"publish","type":"post","link":"https:\/\/forklog.com\/en\/fidelity-analysts-see-no-long-term-threat-to-bitcoin-mining\/","title":{"rendered":"Fidelity analysts see no long-term threat to Bitcoin mining"},"content":{"rendered":"<p>The decline in bitcoin miners\u2019 transaction revenue may prove long-lasting. But it does not threaten the blockchain\u2019s security, according to Fidelity.<\/p>\n<blockquote class=\"twitter-tweet\" data-lang=\"en\">\n<p lang=\"en\" dir=\"ltr\">? Is it \u201ctoo late\u201d to enter the digital assets market? Our 2025 Look Ahead shares our team\u2019s answer and highlights potential opportunities emerging from the approval of spot digital asset ETPs and a post-election surge.<\/p>\n<p>Access the full report: <a href=\"https:\/\/t.co\/sg4W3gRXz2\">https:\/\/t.co\/sg4W3gRXz2<\/a> <a href=\"https:\/\/t.co\/iYsI4iUknB\">pic.twitter.com\/iYsI4iUknB<\/a><\/p>\n<p>\u2014 Fidelity Digital Assets (@DigitalAssets) <a href=\"https:\/\/twitter.com\/DigitalAssets\/status\/1876701590133809206?ref_src=twsrc%5Etfw\">January 7, 2025<\/a><\/p><\/blockquote>\n<p> <script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><\/p>\n<p>As \u201cdigital gold\u201d is integrated into traditional finance, the investor base is shifting. Institutional players are using familiar ways to access the asset.<\/p>\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<p>\u201cLess emphasis on self-custody combined with a greater willingness to rely on third-party custodians has led to lower activity on Bitcoin\u2019s base layer,\u201d said research analyst Zak Wainwright in the 2025 outlook.<\/p>\n<\/blockquote>\n<p>In 2024 miners faced a double bind:<\/p>\n<ul class=\"wp-block-list\">\n<li>daily fee revenue fell throughout the year;<\/li>\n<li>as a result of the halving <a href=\"https:\/\/forklog.com\/en\/news\/bitcoin-undergoes-fourth-halving\">held<\/a> in April, the block reward was cut in half\u2014to 3.125 BTC.<\/li>\n<\/ul>\n<figure class=\"wp-block-image size-full\"><img decoding=\"async\" src=\"https:\/\/forklog.com\/wp-content\/uploads\/FDA-2025-Look-Ahead-Report-V6.webp\" alt=\"FDA-2025-Look-Ahead-Report-V6\" class=\"wp-image-249333\"\/><figcaption class=\"wp-element-caption\">Average daily bitcoin fees. Source: Fidelity.<\/figcaption><\/figure>\n<p>The main driver of lower network fees, the expert argues, were the US spot bitcoin ETFs <a href=\"https:\/\/forklog.com\/en\/news\/sec-approves-all-11-spot-bitcoin-etf-applications\">launched<\/a> in January. The products have already accumulated about 5% of the market supply of the cryptocurrency, which is largely removed from on-chain activity.<\/p>\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"700\" height=\"364\" src=\"https:\/\/forklog.com\/wp-content\/uploads\/FDA-2025-Look-Ahead-Report-V6.pdf-VOVSOFT-pdf.jpg\" alt=\"FDA-2025-Look-Ahead-Report-V6.pdf-VOVSOFT-\" class=\"wp-image-249334\"\/><figcaption class=\"wp-element-caption\">Bitcoin held by exchange-traded funds. Source: Fidelity.<\/figcaption><\/figure>\n<p>Wainwright expects institutional participation to keep expanding in 2025. He sees no reason to anticipate a reversal of the downtrend in miners\u2019 transaction revenue.<\/p>\n<p>He noted that new uses of the Bitcoin blockchain\u2014such as assets on the Ordinals or Runes protocols\u2014have not had a meaningful impact on miners\u2019 profitability.<\/p>\n<p>The <a href=\"https:\/\/forklog.com\/en\/news\/bitcoin-transaction-fees-hit-record-high-on-halving-day\">launch of Runes<\/a> on halving day brought miners about $18 million in fees, but it proved a fleeting spike. Wainwright believes both initiatives look like speculative manias and will never return to their record highs.<\/p>\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"771\" height=\"408\" src=\"https:\/\/forklog.com\/wp-content\/uploads\/FDA-2025-Look-Ahead-Report-V6.pdf-VOVSOFT-PDF-Reader-pdf.jpg\" alt=\"FDA-2025-Look-Ahead-Report-V6.pdf-VOVSOFT-PDF-Reader\" class=\"wp-image-249335\"\/><figcaption class=\"wp-element-caption\">Daily fees from Runes transactions. Source: Fidelity.<\/figcaption><\/figure>\n<p>However, the analyst argues that fears of miners shutting down because of lower revenues\u2014and of network security weakening\u2014are overstated.<\/p>\n<p>Some high-cost miners may relocate to regions with cheaper power. In 2024 one destination for such migration was <a href=\"https:\/\/forklog.com\/en\/news\/ethiopias-share-in-bitcoin-hashrate-reaches-2-5\">Ethiopia<\/a>.<\/p>\n<p>Wainwright also reckons that major exchanges, custodians and other market participants, which profit from activity in the asset itself, have an interest in keeping the blockchain reliable. They may treat mining as an operating expense, with mined coins a bonus to the core business.<\/p>\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<p>\u201cLooking ahead, participation in mining for a profitable bitcoin company or even a nation-state could prove very practical,\u201d Wainwright allowed.<\/p>\n<\/blockquote>\n<p>In October 2024, a researcher under the moniker Duo Nine warned of a <a href=\"https:\/\/forklog.com\/en\/news\/researcher-identifies-vampire-attack-on-bitcoin\">security threat<\/a> to the first cryptocurrency\u2019s network. He pointed to bitcoin liquidity being siphoned into DeFi protocols, exchange-traded products and custodial services.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The decline in bitcoin miners\u2019 transaction revenue may prove long-lasting. But it does not threaten the blockchain\u2019s security, according to Fidelity. ? Is it \u201ctoo late\u201d to enter the digital assets market? Our 2025 Look Ahead shares our team\u2019s answer and highlights potential opportunities emerging from the approval of spot digital asset ETPs and a [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":20212,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"select":"","news_style_id":"","cryptorium_level":"","_short_excerpt_text":"","creation_source":"","_metatest_mainpost_news_update":false,"footnotes":""},"categories":[3],"tags":[1137,1248,1138],"class_list":["post-20213","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news-and-analysis","tag-cryptocurrency-mining","tag-fidelity-investments","tag-opinions"],"aioseo_notices":[],"amp_enabled":true,"views":"36","promo_type":"","layout_type":"","short_excerpt":"","is_update":"","_links":{"self":[{"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/posts\/20213","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/comments?post=20213"}],"version-history":[{"count":0,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/posts\/20213\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/media\/20212"}],"wp:attachment":[{"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/media?parent=20213"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/categories?post=20213"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forklog.com\/en\/wp-json\/wp\/v2\/tags?post=20213"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}