JPMorgan analyst expects demand for Bitcoin to increase over the next 10 years

BlockBeats news, on September 17, JPMorgan analysts released a report saying, "As Bitcoin continues to become mainstream, electricity demand will increase. Bitcoin is not the only cryptocurrency that requires a mining process, but it is the largest.

Bitcoin is the largest proof-of-work (PoW) protocol to date. From a fundamental perspective, we believe that over the next 10 years, demand for and participation in Bitcoin will increase rather than decrease; therefore, Bitcoin mining will become increasingly competitive, with a resulting higher demand for electricity, as miners are essentially working harder to get rewards. In addition, the supply of Bitcoin is fixed (21 million), which further intensifies competition among miners as it approaches the maximum mining opportunity (all Bitcoins have been mined and are in circulation). Finally, we believe that the normalization of asset allocation toward Bitcoin and the U.S. spot Bitcoin ETF

Similar to our view above, we believe natural gas is a logical source of electricity for miners to meet this incremental energy consumption. Many miners are directly connected to the grid, which can be easily served by natural gas. Similarly, due to natural gas's relatively good environmental impact, lower price, and high reliability, we believe natural gas is a logical source of electricity supply for Bitcoin mining equipment (i.e., computers) that prioritizes continuous uptime.

Taking Texas as an example, as one of the most popular states in the United States for large-scale Bitcoin mining, according to Texas data, natural gas is the state's primary energy source, accounting for approximately 43% of all energy consumption in 2022. We believe these data are complementary to our view that natural gas is the natural choice for Bitcoin miners' electricity supply.