Solana soars more than 12% amid broader crypto rally: CNBC Crypto World

today bitcoin's price takes a breather after that huge Wednesday rally coinbase recovers from an outage that showed users empty account balances and Phil Harvey the CEO of saber 56 breaks down what bitcoin's rally means for miners ahead of the upcoming having [Music] event welcome to cnbc's crypto world I'm Talia Kaplan prices of major cryptocurrencies pretty flat as of noon Eastern with Bitcoin trading down half perc but still keeping above the $62,000 mark ether on the other hand slightly in the green Rising less than half a percent to $3,442 salana Meanwhile soaring today by more than 12% to $130 amid this week's broader crypto rally okay let's talk about the top stories coinbase is recovering from an outage that came right in the midst of that huge crypto rally yesterday the trading platform's app showed Zer balances for many users trying to access their accounts around midday yesterday now coinbase told CNBC at the time of the outage that customers assets were safe later in the day the platform bounced back and coinbase posted on X that it was seeing improvements in customer Trading still it warned that some people might see login and transaction errors because of increased traffic shares of the company stock dipped about 1 and a half% as of noon but fell as much as 3 and 1 12% yesterday as the outage was taking place next Gemini has agreed to repay at least 1 .1 billion to customers of the crypto exchanges earn investment program as part of a settlement with New York Regulators that deal reached yesterday would also see the bankrupt platform pay a $37 million fine to the New York Department of Financial Services in part for its dealings with crypto lender Genesis in a statement superintendent Adrien Harris said that Gemini failed to conduct due diligence on an unregulated third party later accused of massive fraud harming earned customers who were suddenly unable to to access their assets after Genesis Global Capital experienced a financial meltdown Jeb also agreed to pay $40 million to earn customers trying to recover funds in the Genesis bankruptcy Gemini took to X yesterday to let earn users know that if the deal is approved by the bankruptcy court they could get back 100% of their digital assets as well as any and all appreciation of assets since lending into the program the post noted that the required bankruptcy court process could take as long as 2 months mons to complete last a new report reveals that the majority of illegal crypto activity is tied to sanctioned groups or terrorist organizations chainalysis released its 2024 crypto crime report today which found that more than $24 billion of elicit cryptocurrency was transferred in 2023 now it's important to note that while that figure was lower than the previous year's number a higher proportion of the funds were attributed to sanctioned entities like those tied to North Korean hacking groups and US designated ter terrorist groups like Hezbollah those tied to sanctioned entities and jurisdictions accounted for more than 61% of total illicit transaction Volume last year chainalysis points out that as adoption of crypto by elicit actors continues to grow so have the tracing and enforcement methods of agencies officials and Analysis firms you can check out the full story over at cnbc.com all right back to bitcoin for our main story as the price of the cryptocurrency soared above $660,000 this week I spoke with Phil Harvey the CEO of saber 56 a digital asset mining consultancy about what the rally means for Miners and what will change after the having in April so yesterday was a big day for crypto with Bitcoin hitting $64,000 closing in on the previous all-time high of nearly $69,000 and this morning Bitcoin was trading above $63,000 now investors are expecting Bitcoin to set a new record this year after the launch of ETFs made the asset class more accessible to institutional investors and with the Network's having event set for April now historical Trends have shown price increases around past having so how much of the recent crypto rally would you say is attributable to the upcoming having and what do you expect will happen with price in the weeks leading up to and following that event the big question right what happens with price so it's anyone's guess I mean historically the the price will rise um how much so it's it's to be determined I would like to think that Bitcoin price should go 150k um over the next four years um and that would be a conservative suggestion um realistically I think it's going to settle around 80 90 um as the as the norm um and that's obviously linked to the miners revenue and the the margins that miners have to make based on the power price so what exactly does this rally mean for miners I read that the number of Bitcoin held in wallets tied to miners has dropped to the lowest since mid 2021 and that blockchain data shows that crypto miners are still selling their Bitcoin as the upcoming having approaches so is this Bitcoin rally contributing to that Trend a lot of it to do with the ETF I think would be foolish to suggest otherwise um miners need to sell Bitcoin right unfortunately people don't accept Bitcoin as a payment um for the utilities for for power so this is something that we will always see um the larger miners that uh that have Fiat to pay for for the operations can obviously subsidize that but Bitcoin still needs to be liquidated in the market periodically so I believe solely that the the the ETF is is is a big push uh in the prices now we've seen that mature in the market um and wider user groups now you know moving forward with the with their ETF Investments so focusing on the having I came across caner Fitzgerald research out last month which warned that if Bitcoin prices do not Rally significantly many Bitcoin miners will not be able to mine profitably the report analyzed 13 publicly listed mining companies and forecasted that 11 of them will fail post having based on the Bitcoin price at the time of $40,000 so what do you think it will take for miners to survive and could this recent rally help them stay afloat well let's unpack that a little bit so miners public miners larger miners are now going through um a change in their in their stock so if you had the older generation of equipment um you know low lower efficiency of around 30 Jews of terahash your margins today are still 30% um up to 50% so they're still making good money once harving takes place they will be underwater or making a small margin of 5% as we then move forward with newer versions newer generations of the uh of the machines those margins start to increase ultimately the price needs to Rise um Global hash power will fall fall after the harving as we saw in previous years the the previous harving cycle we lost around 35% of the global hash rate and then that picked up over time so you know revenue is is a constant EB and flow um you know if we were to say that harving occurs right now then yes a lot of people will be underwater but that is the beauty of Industry right we need to be efficient in order to survive and Bitcoin and Bitcoin mining is no different to any other industry now we spoke with clean spark CEO last month and he forecasted that 15 to 30% of miners will have to shut down post having your company saber 56 consults miners on the development and operation a facility so do you think that's a realistic range and do you expect to see consolidation among minors following the upcoming having absolutely I'm coining this next uh iteration um the industrialization of of mining um and something that we've foreseen for at least 12 to 18 months the real question that we have to ask is how can miners grow the um the issue becomes the access to to power so now we're seeing in the in the space a lot of mergers and Acquisitions taking place because the power just isn't there for for people to grow into um so those underlying assets set the power purchase agreements PPA are becoming extremely lucrative so yes there will be miners that don't have the capital in order to reinvest and therefore you know provided they have a lucrative underlying power asset will become uh an m&a Target um on the flip side of that or or or another view hostage miners so so guys that don't have access directly to the power source that use um third party services to have their machines hosted they will be the first um that will really suffer because their rates are higher because there's additional margin baked in for the service and their machines are are typically older because they're at the back of the queue for the for the new machines 15 or so% I would tend to agree with that as I stated early you we lost 35% of the global hash rate um previously so it's it's an accurate figure in my assumption now we're learning that Riot and cleanspark are expanding their Bitcoin mining operations ahead of the having with Riot acquiring more than 31,000 mining machines and clean spark completing the acquisition of three new facilities what do you make of these developments I take it the firms are trying to enhance efficiency and prepare for the upcoming having events where the amount of Bitcoins rewarded to miners will get cut in half putting Financial pressure on operations so Riot took a very positive view um risky in some regards putting all their you know proverbial eggs in one basket that basket being Texas and and expanding within the state so they have the ability to expand um and they have space for those machines to go into other miners um Marathon for example um they were a hosted only so an asset like model they made a transaction last year they completed that around 178 million I think for 300ish megawatts so you know these miners are are taking notice now uh same with clean spark so as you look at the top 10 miners um it's really the top five top six that have the cash flow in order to deploy to purchase machines and the infrastructure and again you know unless you're up for m& that's really the only way to uh to grow considering the the restriction on the on the access to power it's just not not there anymore um you know we see this this daily okay that's all for crypto world today but we'll be back again tomorrow and we'll see you then

Channel: CNBC Television

Views: 19,713

Keywords: crypto world, cryptocurrency, bitcoin, digital currency, CNBC, business news, finance stock, stock market, news channel, news station, breaking news, us news, world news, cable news, finance news, money, money tips, financial news, stock market news, stocks, crypto investing, crypto, crypto mining, bitcoin mining, crypto industry, ether, U.S. currency, U.S. economy, cryptocurrency news, Bitcoin, crypto world cnbc, blockchain, ftx, etf, ethereum, web3, phil harvey, sabre56

Id: i-QgZpxZ8gE

Length: 11min 46sec (706 seconds)

Published: Thu Feb 29 2024