Meanwhile, White is forecasting the price of bitcoin (BTC-USD) to average ~$29K in 2022 vs. ~$37K in the prior view given the recent failures in algorithmic stablecoin TerraUST (UST-USD) and its sister token Luna (LUNA-USD), as well as crypto hedge fund Three Arrows Capital and crypto exchange Celsius.
In 2023, though, the analyst sees bitcoin’s (BTC-USD) average rising to ~$34K (vs. ~$50.5K in the previous forecast), ending the year at $43.5K.
In the near term, “we expect many miners globally to reduce CAPEX by deferring project work and canceling mining orders,” White wrote in a note to clients. But “if BTC prices recover in 2023 as we expect, we believe those miners who can stay afloat will have the opportunity to grow at a lower cost, as mining rig prices come down and the capital markets open back up.”
Nevertheless, Riot’s (RIOT) mining metrics softened M/M in May as the company not only mined a smaller number of bitcoins (BTC-USD), but it also reduced its 2023 hash rate guidance with expectations for 12.6 EH/s of mining capacity vs. 12.8 EH/s in the prior view. While investors wait for June numbers, bitcoin (BTC-USD) has dropped around 25% since the end of May as the liquidity crunch sets in.
Looking at intraday price action, bitcoin (BTC-USD) is edging up 1.6% to around $21K as of shortly before 10:00 a.m. ET. Perhaps bitcoin’s modest intraday bounce is helping push shares of Riot (RIOT) and other miners like Marathon Digital (MARA) +1.5% higher.
Compass Points’ Buy rating contrasts with the Quant system, which rates Riot (RIOT) as a Strong Sell with poor marks in profitability and momentum. On the flip side, the Average Wall Street Analyst views the stock as a Strong Buy (5 Strong Buy, 2 Buy, 1 Hold).
Take a look at why SA contributor Made Easy – Finance thinks Riot Blockchain is a Hold.