Bitcoin BTC’s drop from around $30,000 to $25,000 in just 48 hours has left investors facing significant liquidation. However, this sudden drop may not be the end of the story. There is an important situation when we look more deeply at the miner statistics. Accordingly, it turns out that if certain conditions persist, another price collapse may be on the horizon. The primary concern revolves around Bitcoin’s hashrate and the increasing pressure for miners to dump their holdings.
Bitcoin miners’ dilemma
Bitcoin’s price drop to $25,000 triggered significant liquidations in a short period of time. Still, this bearish trend is likely to repeat itself. The key factor in this equation is the hash rate, which continues to increase. If the hash rate remains high and the price finds it difficult to recover quickly, this is a different development. Bitcoin BTC miners are forced to sell what they have.
The 7-day average hashrate of Bitcoin BTC is currently around 409 million TH/s. On the other hand, it shows no signs of slowing down. The increase in hash power is generally seen as a positive development. On the other hand, it becomes problematic when coupled with falling BTC prices. High hashrate makes the mining process more expensive. As long as market conditions do not change in favor of miners, pressure to sell BTC holdings could intensify.
Miner reserve growth
Notably, as the hashrate continues to rise, so does the miner reserve, which represents the amount of Bitcoin BTC held by miners. In the final stage of Bitcoin’s rise, when it rose from around $26,000 to $31,500, the miner’s reserve increased from 1.82 million BTC to 1.84 million BTC. This 200,000 BTC growth came after the last price drop. An important move takes place if the miners do not see that the conditions are developing in their favour. Accordingly, these Bitcoin reserves eventually find their way to exchanges where they can be sold.
When we look at Kriptokoin.com, in the light of these developments, investors should be careful. They should also closely monitor the price movements of Bitcoin BTC. A major move will come if a recovery rally is delayed while the hash rate remains high. Accordingly, this will potentially trigger a sale. The complex interaction between hash power, miner reserves and BTC prices underscores the need for caution in the cryptocurrency market.
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