Riot Platforms stock price has slipped hard in the past few weeks even as Bitcoin has surged to a record high. The stock peaked at $18.22 in January and has now retreated to $10.83. This price action is in line with the other top Bitcoin mining companies like Marathon Digital, Bitfarms, and Argo Blockchain.
Bitcoin halving ahead
The main reason why RIOT stock price has crashed is that the countdown to Bitcoin halving is running at a fast pace. The event, which will happen on April 20th, will lead to more challenges for mining companies.
Halving will lead to an immediate cut in the number of Bitcoins that are mined every day. Today, mining companies produce over 900 Bitcoins per day, a figure that will drop to less than 450.
Halving will affect Bitcoin mining companies by slashing their mining volume in half. The most recent report revealed that Riot Platforms produced 418 coins in February, a decline from the 520 it produced in January and the 675 it mined in February 2023.
In this case, these firms need two things. First, they need to boost their mining operations by buying more mining machines.
The company recently acquired 31,500 miners from MicroBT in a $97 million deal. As a result, it expects that its hash rate will jump to 40.8 EH/s in H2’25 from 31.5 EH/s in Q4’24. However, many of these new mining machines will be used to replace underperforming platforms.
Second, they need a high Bitcoin price, which is possible because of the rising demand by ETF investors. History is in their side since Bitcoin has always risen over the years. It has jumped from near zero in 2019 to over $70,000.
Riot Platforms has benefited from the recent Bitcoin surge. The most recent results showed that the company’s revenue jumped to over $78.8 million in the fourth quarter. That was a big increase from the $60.1 million it made in the same quarter.
For the year, Riot Platforms made over $280 million, $30 million higher than in 2022. It produced 6,626 Bitcoins in 2023 after mining 5,554 in 2022.
Riot Platforms stock price forecast
The daily chart shows that the RIOT stock price formed a double-top pattern at $18.22 between January and February. In most cases, this pattern is one of the best signals that an asset price will continue falling.
The stock has also slipped below the 50-day and 25-day Exponential Moving Averages (EMA). It is also nearing the ascending trendline, which connects the lowest swings since December 2022.
RIOT is also approaching the neckline of this pattern at $9.60. Therefore, more downside will be confirmed if the stock moves below the ascending trendline and the support at $9.60. On the flip side, the stock may rebound as investors buy the dip.
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