JPMorgan has revised its ratings for key players in the cryptocurrency mining sector, specifically targeting Bitcoin miners, amidst growing criticism from the crypto community. The update, which occurred on Monday, involves upgrades for Cipher Mining and CleanSpark, while expectations were lowered for several other prominent firms in the industry.
The recent backlash against the financial giant intensified after a research note linked to MSCI raised concerns about potential exclusions of companies heavily invested in cryptocurrencies. This includes MicroStrategy (NASDAQ: MSTR), which holds a significant amount of Bitcoin. The impending MSCI decision on January 15 could lead to substantial outflows from their indices, estimated at $2.8 billion, and potentially $8.8 billion if other index providers follow suit. This has prompted calls for a boycott of JPMorgan from notable figures in the Bitcoin community.
The controversy escalated when Strike CEO Jack Mallers revealed that JPMorgan had closed his personal accounts due to “concerning activity,” a move he described as frustrating and lacking transparency.
Upgrades for Cipher Mining and CleanSpark
Analysts Reginald Smith and Charles Pearce highlighted that miners are entering a more confident phase, focusing on high-performance computing (HPC) expansions. Since late September, over 600 megawatts (MW) of AI-related agreements have been established with major firms like AWS, Fluidstack, and Microsoft. They forecast approximately 1.7 gigawatts (GW) of new critical IT capacity to be announced by late 2026.
Cipher Mining (NASDAQ: CIFR) received an upgrade to Overweight, with its price target for December 2026 raised to $18 from $12. Analysts noted a significant pullback in share price, which they view as an advantageous entry point. They project that Cipher will secure 480 MW of critical IT capacity by 2026, representing around 64% of its approved capacity.
CleanSpark (NASDAQ: CLSK) also saw its rating upgraded to Overweight, maintaining a price target of $14. The firm is focusing on expanding its energy-efficient infrastructure across the U.S., boasting an estimated 200 MW of HPC potential at its newly acquired Texas site.
Mixed Revisions for Other Miners
In contrast, Marathon Holdings (NASDAQ: MARA) faced a target reduction to $13 from $20 due to declining Bitcoin prices and increased network hashrate. The company operates a broad fleet of ASIC machines across various facilities. Similarly, Riot Platforms Inc. (NASDAQ: RIOT) had its target decreased to $17 from $19, reflecting lower valuations in the mining sector.
In a related context, several Bitcoin miners are pivoting towards artificial intelligence workloads as traditional mining proves less profitable. This shift is significant as the Bitcoin network relies on miners for transaction validation and block addition, with profitability further challenged by halving cycles that reduce coin issuance.
As the industry evolves, the dynamics between crypto mining and emerging technologies like AI will be closely monitored by investors and analysts alike.
