Bitcoin (BTC) has experienced a 4.5% decrease in value over the past week, hitting a monthly low of $65,000. This decline has been attributed to a surge in selling activity from Bitcoin mining entities. According to analysts from the latest CryptoQuant weekly report, the number of BTC sent from mining pools to exchanges has spiked to a two-month high. Notably, on June 9, the hourly transfer of BTC from the btc.com mining pool to Binance exceeded 3,000 BTC, marking a significant increase in selling.
In addition to smaller mining pools, large Bitcoin mining companies have also intensified their selling activities. Marathon Digital, a U.S.-based mining entity, has sold 1,400 BTC in June alone, representing 8% of its total holdings. This is a substantial increase from the 390 BTC sold in May. The heightened selling pressure from Bitcoin miners comes as their revenues have decreased significantly since the halving event.
Decline in Miner Revenues and Transaction Fees
Daily miner revenues have plummeted to around $35 million, down 55% from the peak of $78 million reached in March. This decrease can be attributed to lower transaction fees, which have dropped from 117 before the halving to around 65 currently. Despite the increased number of transactions on the network, median transaction fees have remained low in USD terms, putting additional strain on miners.
Impact of High Hashrate on Miners
Despite the decline in revenues, the Bitcoin network’s hashrate has remained high, only decreasing by 4% since the halving in April. A high hashrate indicates that miners require more computing power, energy, and time to validate transactions and add blocks to the blockchain. This situation has led to miners being underpaid or even extremely underpaid, considering the current circumstances. However, analysts suggest that low miner revenues coupled with a high hashrate could signal potential price bottoms for Bitcoin.
As Bitcoin miners continue to face financial pressure, it remains uncertain how low BTC prices can go before a market recovery occurs. The increased selling activity from mining entities, coupled with a decline in revenues and transaction fees, has contributed to the recent dip in Bitcoin’s price. However, the high hashrate of the network indicates underlying strength, which could potentially lead to a price rally in the future. It will be interesting to observe how these factors play out in the coming weeks and months in the volatile cryptocurrency market.
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