Analysts downgraded two major miners
It's about Core Scientific and Argo Blockchain. Their ratings, which used to be rated as "buy," dropped to neutral. According to investment bank DA Davison, this is a result of the impact of the cryptowinter, which continues to bring losses to companies.
Nevertheless, according to analyst Chris Brendler, he continues to believe in the long-term potential of digital gold. However, he also notes that the profitability and liquidity of miners at the current moment are experiencing serious difficulties with the cost of energy resources.
Brendler had previously made more optimistic predictions, believing that falling BTC prices and rising energy costs would cause the network's hashrate to decline. Those assumptions have not materialized, as complexity and hashrate continue to rise.
The bearish trend that formed in the market led to a drop of more than 70% in the securities of the mining companies. As a result, bankruptcy proceedings have begun.
Chris Brandler pointed out the difficulty in Core Scientific's downgrade process, as the company is still a leader in its field. However, in his opinion, it is clear that Miner is struggling with a lot of issues at the moment, including a downgrade in liquidity.