Bitcoin miners had to sell Bitcoin (BTC) due to bad market conditions, but this situation seems to be reversed at the moment.
Bitcoin’s trip to $25,000 this month has eased the pressure on a struggling Bitcoin mining industry throughout 2022. At one point, fears grew that the cost of production for miners was much higher than the spot price of Bitcoin, and heavy sales would come for miners to stay in business. Worse still, many may have to quit altogether, as their activities are no longer financially viable.
BTC Prices Need to Rise for Bitcoin Miners to Rebound
Data obtained since May seemed to confirm that there was great turmoil. As Arcane notes, only one public miner Core Scientific sold around 12,000 BTC during the May-July period.
While this trend seems to have reversed in the last month, BTC prices need to rise further before even the largest mining operations can rally again.
Arcane analyst Jaran Mellerud said:
“Even though public miners sold less than half of the amount mined in July as in June, if we look at the percentage of Bitcoin production sold, we see that they continue to drain their holdings.”
For the Third Month, Miners Have Been Selling More Bitcoin Than They Issued
Public miners sold 158 percent of their Bitcoin holdings in July, the third month in a row that they sold more than produced.
In context, in April 2022, miners’ hodled coins were at an all-time high, with at least 60 percent of the BTC received each month via block subsidies being saved for years.
However, after the sales, their balance is 30 percent lower in volume and they will continue to sell only until the monthly expense balance is reestablished.
Arcane analyst Jaran Melleurd said:
“If nothing major happens to the bitcoin price, I expect the selling pressure to continue between 100 percent and 150 percent of production. This equates to 4,000 to 6,000 BTC per month.”
Bitcoin (BTC) may have risen 36 percent from its June low, but the bitter period for miners will continue.
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