Bitcoin miners are preparing to transform their business model to emphasize blockchain infrastructure over speculative mining, said Bo Turner, CEO of Abundant Minds.
summary
- Long-term Bitcoin holders are showing early signs of selling at a loss as the SOPR indicator for long-term holders dips below 1.0, suggesting a possible capitulation.
- Although large holders are reducing their positions at the fastest pace since early 2023, the 30-day average LTH SOPR remains positive, suggesting some resilience.
- Analysts point to mixed signals, with short-term holders near profitability and technical patterns suggesting the trend may continue, while repeated resistance could limit near-term upside.
In an interview with TheStreet Roundtable, Turner said major mining operations are adjusting their strategies as the industry moves further into the post-halving era. “The largest companies in the industry are often transitioning their business models away from just being a primary self-mining operation,” Turner said.
The executive suggested that future mining operations may increasingly focus on block space rather than block rewards. “It’s going to make miners feel like a critical infrastructure business,” Turner said. “We talk more about block space than block rewards.”
As Bitcoin adoption grows among governments, businesses, and financial institutions, Turner suggested that available space on Bitcoin’s blockchain could become a scarce resource. The CEO likened city block space to strategic goods, such as metals and energy resources, that a nation is trying to secure.
Turner predicted that the specialization of mining operations could reduce the volatility of the sector’s traditional boom-bust cycles. “I think this is going to continue to be an incredibly lucrative industry for the next 10 years for those who institutionalize and those who specialize,” Turner said.
Bitcoin halving is a programmed event that occurs approximately every four years and reduces block rewards paid to miners by 50%. This mechanism slows down the generation of new Bitcoins and maintains the network’s fixed supply cap of 21 million Bitcoins.
The most recent halving took place in April 2024, reducing the block reward from 6.25 Bitcoins to 3.125 Bitcoins per block. The next halving is expected in 2028, possibly in April, depending on how long the network is blocked. At that point, the block reward will be reduced to 1.5625 Bitcoins.
According to Bitcoin’s protocol design, the halving mechanism is designed to gradually shift miners’ revenue from block subsidies to transaction fees.
