After the November plunge in profitability, Bitcoin miners have begun to sell off their coins and share their company stockpiles.
Bitcoin (BTC), currently at $43,500, is 33% lower than the all-time high of $69,000, which was reached in that month. Miners are therefore selling at a more unfavorable time. But, equipment and electricity bills must be paid.
Glassnode, an on-chain analytics company, has data that shows Bitcoin miners are now net sellers after being net hodlers for several months.
According to data from blockchain research firm Arcane Research, the average return on mining one BTC has fallen by 50.5% since Nov. 9. This means that the rate at which the investment returns have decreased is greater than the price for BTC.
Mining’s profitability has declined due to a large increase in hashrate. Because more miners are trying to find the next block, there is more competition among them.
Cointelegraph reported that Bitcoin had achieved a new ATH for hashrate on February 13. This milestone was reached by jumping from 188.4 to 284.11 exahashes per hour (EH/s), in just one day. According to Ycharts, the hashrate currently stands at 232.19 EH/s.
Some large mining companies have chosen to sell stocks over crypto in order to grow their cash reserves or pay their bills. Bloomberg was informed by a spokesperson from Marathon Digital Holdings Inc.’s (MARA) mining operation that they had started hodling in Oct 2020 and have not sold one satoshi since.
Marathon instead filed an application with the Securities and Exchange Commission to sell $750,000,000 in securities and stocks. Seeking Alpha reports Marathon plans to use a substantial portion of the funds for hardware purchases and other general purposes.
MARA is currently at $28.24 after-hours trading and down 0.56%.
Related: Russian Ministry wants to Legalize Bitcoin Mining in Certain Areas
D.A. is a wealth management company that employs an analyst. Bloomberg was told by Davidson on February 14th that miners are reluctant to sell Bitcoin for ideological and business reasons.
“Big miners prefer to sell equity because their shareholders want them hold their Bitcoin and not think about selling it.”
Eileen Wilson –Technology and Energy
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