BlackRock seeks Bitcoin spot ETF as network hashrate climbs

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BlackRock seeks Bitcoin spot ETF as network hashrate climbs

NEW YORK - BlackRock (NYSE: BLK ), the world's largest asset manager, has applied for a Bitcoin spot Exchange-Traded Fund (ETF) as the cryptocurrency's network strength hits new highs, with its hashrate reaching 450 exahashes per second (EH/s). This move comes as Bitcoin prices soar past $37,000 ahead of the much-anticipated halving event slated for 2024.

The increase in Bitcoin's hashrate, a measure of computational power used to mine and process transactions, marks a significant growth from January 2022's 200 EH/s. This growth trajectory mirrors the experiences of gold rush miners: some have struck it rich, achieving financial independence quickly, while others have faced challenges such as regulatory changes and financial hurdles. Notably, the latter was evident in Core Scientific's decision to file for bankruptcy protection during the bear market of 2022.

Bitcoin mining requires careful strategic management due to factors like the volatility of Bitcoin prices and potential increases in electricity costs. Miners are drawn to regions that offer policy leniency and lower energy costs, including North America, Northern Europe, the Middle East, Latin America, Kazakhstan, and Russia. Additionally, selecting efficient mining rigs is critical for economic viability.

Profitability metrics such as hash price—which reflects miners' revenue—experienced a boost during the hashrate decline in 2021 driven by policy changes. However, profitability has tightened due to continuous hashrate growth despite the bear market conditions of 2022. The introduction of Ordinal inscriptions in 2023 played a role in increasing mining fees, contributing to a recovery in price.

ViaBTC Pool (NASDAQ: POOL ) has emerged as a consistent income source for miners by offering features such as Auto Withdrawal/Conversion and a Crypto Loans tool that enhances asset liquidity. Recognized among the top-tier Bitcoin mining pools by hashrate, ViaBTC advocates for viewing mining as an investment that requires patience and strategic planning to achieve long-term profitability.

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