The rising cost of energy is proving to be a challenge for bitcoin miners as their margins shrink. Fundstrat vice president of digital asset strategy Sean Farrell joins Morning Brief to discuss how the bitcoin industry is navigating rising kilowatt-hour costs and some of the potential challenges moving forward.

"A lot of these miners already have embedded PPAs (power purchase agreements) and so the volatility around energy costs don't affect them as much in the immediate term. Long-term, certainly that is a consideration," Farrell explains.

He notes that the marginal cost of production for miners hovers around the low 50s, high 40s, explaining, "a lot of them are operating on razor-thin margins at this point." He argues that to become more profitable, bitcoin prices will ultimately have to go up.

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This post was written by Melanie Riehl