Plummeting cryptocurrency prices have made life difficult for Bitcoin (CRYPTO: BTC) miners in 2022, but Canaccord Genuity analyst Joseph Vafi said Monday that he maintains his bullish long-term outlook for crypto miners Argo Blockchain ADR (NASDAQ:ARBK), HIVE Blockchain Technologies Ltd (NASDAQ:HIVE), Hut 8 Mining Corp (NASDAQ:HUT) and Iris Energy Ltd (NASDAQ:IREN).

Mining Efficiency Critical: In his monthly digital asset mining update, Vafi said production has been on the rise among top miners despite the downturn in crypto prices. In May, North American miners increased their output, while miners in China came back online as well.

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Vafi also said there are factors helping to offset profit and margin pressures on miners. As less efficient miners shut down production, higher-efficiency miners that can remain profitable at breakeven Bitcoin prices in the $7,000 to $9,000 range are taking over that market share. In addition, Vafi said prices on specialized Bitcoin application-specific integrated circuits (ASICs) are starting to fall, providing the opportunity for miners with strong balance sheets to expand their production at a much lower cost than six months ago.

How To Play It: Vafi said the four Bitcoin miners Canaccord covers all have access to capital and are maintaining consistent production as they invest in building future mining capacity.

"Clearly, BTC spot prices have yet to decouple from risk equities, but we still see attractive long-term characteristics for the digital asset," Vafi said.

Canaccord Genuity has the following ratings and price targets for the crypto miners mentioned:

• Argo Blockchain: Buy rating, $13 target
• HIVE Blockchain: Buy rating, $14 target
• Hut 8 Mining: Buy rating, $6 target
• Iris Energy: Buy rating, $14 target

Benzinga's Take: Bitcoin and other cryptos have experienced several drawdowns of more than 80% throughout its history, and the current pullback has Bitcoin prices trading nearly 70% off of its highs in late 2021. However, with break-even prices of below $9,000, these highly efficient miners could seemingly still turn a profit even if Bitcoin prices dropped another 50% from current levels.

Photo: FabreGov via Shutterstock