Many Bitcoin miners will probably use the regained profitability as an opportunity to sell.
While Bitcoin ( BTC ) has seen its highest price since January 2018 , mining the market-leading cryptocurrency is becoming more and more profitable for several reasons
According to data from Blockchain.com, Bitcoin miner’s sales have now risen to a level that has not yet been reached since the halving in May 2020. In the course of the “halving” of Bitcoin, the so-called block reward was reduced from 12.5 BTC to 6.25 BTC , which makes the newly achieved profitability all the more astonishing.
The turnover of the BTC miners reached a value of 20.8 million US dollars on November 4th, which is also the highest value since September 2019, when the block reward was twice as high as it is now.
The sudden jump in the turnover of the crypto miners is primarily due to the fact that the Bitcoin Loophole price has doubled since the halving in May. On November 4, for example, an annual high of 15,950 US dollars was achieved when the price had shot up by more than 20% in the last seven days.
Another reason for the rise in mining revenue is Bitcoin’s increased transaction fees. As Cointelegraph reported, these had gone up 200% in October . Accordingly, the share of transaction fees in miners‘ sales has also increased and currently accounts for 4.15 million US dollars or 20%.
Since the situation for the miners is currently more profitable than ever, some will probably take the opportunity to realize their profits
As the market researchers from CryptoQuant suspect , many miners will therefore sell their „mined“ Bitcoin. This thesis is confirmed by the Miner Position Index, which is currently at 4, with a value of 2 or more indicating that the miners are aiming to sell.
In addition, a clear spike can be seen in transactions by miners to crypto exchanges after the Bitcoin price climbed above the 15,000 US dollar mark. Although the amount is still relatively small compared to before the halving, the sales pressure created by the miners could possibly torpedo the current soaring of Bitcoin.
However, CryptoQuant CEO Ki Young Ju gives the all-clear , because he suspects that the miners will initially play it safe, but actually assume that prices will rise and will therefore hold onto the majority of their crypto assets.