Bitcoin Miners Outsell Production Amid 18-Month High Price Surge
As Bitcoin’s value surges to an 18-month high of $37,000, marking a stellar year-to-date climb of over 100%, top Bitcoin miners have made a striking move. Significantly, they sold 5,492 Bitcoin, cashing out around $164 million. This figure overshadows the amount they produced, clearly showing their sales strategy during the crypto rally.
Miner’s Strategic Sales Spike
Miners like Marathon Digital Holdings and Core Scientific Inc., caught in the excitement of Bitcoin’s significant rally, opted for a strategic liquidation. The MinerMag’s data reveals a liquidation-to-production ratio of 105% for October. Hence, miners did not just sell the month’s yield but also dipped into reserves. This approach marked a notable uptick from the previous quarter’s more conservative ratios of 64%, 77%, and 77%.
Additionally, amid last year’s market crash and rising power costs, the ratio spiked to 390% in June, showcasing the volatile nature of crypto-economics. This October’s figures suggest miners are seizing the moment, cashing in on the rallying prices.
Prepping for Bitcoin’s Halving
Moreover, this sales trend concerns more than capitalizing on a price surge. Miners are bracing for the upcoming halving event, a significant update to the Bitcoin code. Bitcoin’s halving is a quadrennial recalibration designed to maintain the token’s scarcity, capping the supply at 21 million.
Furthermore, Bob Burnett, CEO of Barefoot Mining, predicts a 52.2% reduction in miner rewards post-halving. However, he remains optimistic, suggesting that increasing transaction fees could buoy the industry, with daily Bitcoin production potentially surpassing 900 BTC by 2027. Consequently, selling now is also a tactical move for miners to strengthen their financial buffer against the expected dip in mining income.
Read Also: Bitcoin Miners Sell Over 20,000 BTC In a Week, Is A Further Dip Coming?
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