Bitcoin (BTC) has taken a hit in the past week, dropping by 4.5% and reaching a monthly low of $65,000. This decline in value may be attributed to a rise in selling from mining entities. According to the latest CryptoQuant weekly report, Bitcoin mining entities have been sending a significant amount of BTC to exchanges, marking a two-month high in transactions. For example, on June 9, the btc.com mining pool transferred over 3,000 BTC to the crypto exchange Binance, signaling a surge in sell-off activity.
As a result of lower transaction fees, mining companies have seen a decline in their revenues. Some of the prominent Bitcoin mining entities, like Marathon Digital in the U.S., have significantly increased their selling activity. Marathon Digital alone has sold 1,400 BTC in June, representing 8% of its total holdings – a stark increase from the 390 BTC sold in the previous month. The reduced revenues are a direct consequence of the halving, which has slashed daily miner revenues by 55% from the peak reached in March.
Despite the decrease in revenues, the Bitcoin network’s hashrate has remained relatively high, only dropping by 4% since the halving in April. The high hashrate puts additional pressure on miners, requiring more computing power, energy, and time to validate transactions and add blocks to the chain. This increased competition for lower block rewards has left miners feeling underpaid, if not extremely underpaid. Currently, Bitcoin’s hashrate stands at 599EH/s, slightly lower than the pre-halving rate, indicating a challenging environment for miners.
CryptoQuant analysts have noted that periods with low miner revenues and high hashrates typically coincide with price bottoms for Bitcoin. The market is now waiting to see how low BTC can go before experiencing a potential rally. Despite the challenges faced by miners, it is essential to monitor the selling activity and its impact on BTC prices closely to understand the dynamics of the market. The future of Bitcoin’s price movement remains uncertain, as mining entities continue to navigate the evolving landscape of the cryptocurrency market.
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