Public Bitcoin miners sell BTC reserves when the crypto winter sets in

There must be a bear market if Bitcoin mining companies, usually the ultimate HODLerehave started selling their storage.

Listed Bitcoin Miners, such as Marathon Digital and Riot Blockchain, sold more Bitcoin than they produced last month, a big step up from the first four months of the year when they sold only about 30% of what they produced, according to a new report from Arcane Research.

“If they are forced to liquidate a significant portion of these holdings, it could help push the Bitcoin price further down,” wrote Jaran Mellerud, an Arcane Research Bitcoin mining analyst, in a report.

Yesterday, Toronto-based Bitfarms sold 3,000 Bitcoin – almost half of the offer – to reduce debt. The plan going forward will be to no longer HODL its entire daily Bitcoin production, said Jeff Lucas, Bitfarm’s CFO, in a press release.

“While positive about long-term BTC inflation,” he said, “this strategic change enables us to focus on our top priorities in maintaining our world-class mining operations and continuing to grow our business in anticipation of improved mining economies.”

When it comes to public companies, miners have accumulated a lot of Bitcoin. In fact, seven of the 10 largest Bitcoin treasure chests belong to miners, according to Bitcoin Treasuries. They include Core Scientific (CORZ) has 8,497 BTC; Marathon Digital Holdings (MARA) has 8,133 BTC; Hut 8 Mining (HUT) has 7,078 BTC; Riot Blockchain (RIOT) has 6536 BTC; Hive Blockchain (HIVE) has 4,032 BTC; Bitfarms (BITF) has 3,075 BTC; and Argo Blockchain (ARBK) has 2317 BTC.

Nevertheless, it is worth noting that listed miners account for only 20% of hash rate of 206 million Terrahash per second (TH / s) Bitcoin network.

Taken as a whole, Bitcoin miners seem to be holding on to Bitcoin, and their supply has hardly been random since January, Zack Voell, an analyst at Bitcoin mining software company Braiins, said on Twitter.

The network’s hash speed is an overall measure of how much computing power is used to extract Bitcoin. Each hash represents a computer that generates a new number to “guess” a cryptographic string. No matter which miner or group of miners guesses correctly, the right to confirm a block of transactions and add it to the blockchain wins.

When that happens, miners earn rewards and transaction fees. But mining has become increasingly unprofitable as markets continue to lag behind.

Miner revenues have struggled to stay above $ 20 million per block since the beginning of the month. Revenue per block started the year at around $ 50 million, had fallen just under $ 40 million in early May, and fell as low as $ 16 million last week, according to Blockchain.com, during the panic over the troubled hedge fund Three Arrows Capital and crypto lender Celsius.

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