Miners Are Emulating MicroStrategy’s Approach to Acquiring Bitcoin, According to JPMorgan.

A recent report by JPMorgan reveals that crypto miners are increasingly adopting a bitcoin accumulation strategy, similar to that of MicroStrategy (MSTR), amid profitability pressures. The strategic shift, according to the report, is driven by the reward halving in April and the rising network hashrate, which has led to more competition and mining difficulty.

The hashrate, which represents the total computational power used to mine and validate transactions on proof-of-work blockchains, is a key indicator of competition in the mining industry. JPMorgan analysts, led by Nikolaos Panigirtzoglou, suggest that these changes have prompted miners to either hoard bitcoin or seek further investment opportunities in sectors like artificial intelligence (AI) and high-performance computing (HPC).

Companies such as MARA Holdings (MARA), which now holds 35,000 BTC worth around $3.5 billion, are following a similar strategy, making it the second-largest publicly traded corporate holder of bitcoin.

Miners are not alone in this strategy shift. Medical-device manufacturer Semler Scientific has also made significant moves in the crypto market, acquiring $144 million worth of bitcoin.

The introduction of spot bitcoin exchange-traded funds (ETFs) in January has provided institutional investors with a more straightforward method of gaining bitcoin exposure, but this has led to a decline in the stock performance of bitcoin miners, traditionally seen as a proxy for the cryptocurrency.

JPMorgan also highlighted a shift in how miners are financing their operations. Rather than selling their bitcoin reserves to cover operational costs, miners are increasingly turning to debt and equity offerings. In fact, more than $10 billion has been raised through equity this year, surpassing the previous record of $9.5 billion in 2021.