The past few times have been very volatile for bitcoin miners. After nearly pulling the plug last year, many miners turned a lot of profit earlier this year because Ordinals NFTs caused huge network costs. But after that, some major investors sold many of their coins, including miners. According to Bitfinex, miners are now saving net BTC again.
Bitcoin whales sold their holdings
After Ordinals made it possible to place non-fungible tokens (NFTs) on the Bitcoin network, transaction costs increased by a factor of 21 in a very short period of time in April. This was very beneficial for miners as they collected the transaction costs in May.
But at that point, Bitfarms, one of the largest publicly traded miners, announced that it had sold almost all of the coins mined that month. Soon after, other miners made the same decision. Unfortunately they were not alone whale Who decided to do this? In June, several major investors sent their bitcoins to exchanges.
To make matters worse, the mining difficulty also increased enormously due to increasing competition.
miners Accumulate Bitcoin again
Nevertheless, according to Bitfinex, there is no reason to panic. A comprehensive research report describes that miners are again saving BTC. According to on-chain data from CryptoQuant, the number of bitcoins held by miners has surged, reaching levels not seen since earlier this year. They would potentially do so in preparation for the upcoming halving in 2024.
According to the crypto exchange, bitcoin miners are regular fanatical traders. In early 2023, their positions on exchanges would have even been liquidated for trading with leverage. However, the report also mentions that miners are generally very smart.
Bitfinex emphasizes that the shares of listed miners have also risen sharply. You now have more capital to get you through any difficult times that may arise. This allows them, for example, to expand their mining capacity or trade Bitcoin with leverage. This reduces the pressure to sell the mined coins.