Argo Blockchain share price continued its sell-off this week as focus shifts to the upcoming Bitcoin halving event. The ARB stock price collapsed to 11p in London and is hovering near its lowest point since March. Similarly, in New York, the ARBK stock plunged to a low of $1.30.
Bitcoin halving this week
The biggest crypto news event of the year will happen this week when the Bitcoin halving event happens. Halving is an important approach that reduces the number of Bitcoin rewards that are offered to miners.
It will have major implications to all mining companies as it will lead to fewer Bitcoins that they will produce. Indeed, the Bitcoin mining difficulty has now jumped to a record high and the situation will get worse in the coming months.
I believe that some Bitcoin mining companies will do well over time, especially when the price of BTC rebounds. The firms that will thrive after halving are those with strong balance sheets as it will help them to upgrade their mining machines to more efficient ones.
At the same time, as in other new industries, some companies will either go out of business or get acquired by their bigger ones.
Sadly, I believe that Argo Blockchain is not in a good shape as we move into the halving event. For one, its Bitcoin mining production has not been in a good shape for a while now.
Data shows that the company mined 103 Bitcoins in March and that it held just 26 Bitcoins in its balance sheet. Coins in the balance sheet are now valued at just $1.6 million.
Argo Blockchain produced 124 coins in January. As such, the decline in March was likely because it decided to sell its Mirabel facility. It then relocated its mining machines from Mirabel to Baie Comeau.
However, the weak trajectory has been going on for a long period. In 2023, the company’s best month was in May when it mined 173 coins while its worst one was in August when it mined 105 coins. As shown below, it is evidence that the company’s Bitcoin production was not growing.
Argo Blockchain share price forecast
The daily chart shows New York’s Argo Blockchain stock price. It formed a death cross pattern on March 19th as the 200-day and 50-day moving averages made a bearish crossover. It has remained below these moving averages since then.
The stock has also dived below the 78.6% Fibonacci Retracement level while oscillators have pointed downwards. Therefore, I suspect that the stock will continue falling in the coming weeks as sellers target the crucial support at $1.
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