With the fourth halving of Bitcoin coming in 74 days, Bitcoin miners are actively preparing for the potential reduction in rewards. According to data from CryptoQuant, Bitcoin miners’ reserves have decreased by about 8,400 coins since the beginning of the year, reflecting that mining companies may be selling Bitcoin to raise funds to expand their mining power.
As the countdown to the fourth halving of Bitcoin approaches, investors in the market are eagerly anticipating a bull market similar to the past halvings. However, institutional surveys have also warned that if the price of Bitcoin does not rise significantly after the halving, mining companies will face serious losses.
According to the latest data from CryptoQuant, Bitcoin miners currently hold about 1.8264 million coins, a level last seen in June 2021, and a decrease of about 8,400 coins compared to the 1.8348 million coins at the beginning of the year.
The reason for miners selling Bitcoin, as stated in a report by cryptocurrency exchange Bitfinex on Monday, is mainly to raise funds for upgrading machinery and mining facilities to improve mining efficiency and competitiveness.
The report points out that these miners are preparing for the upcoming halving event, which will have a significant impact on mining profitability, especially for smaller, less efficient mining companies, which may lead them to bankruptcy or forced consolidation.
Matthew Sigel, Director of Digital Assets Research at VanEck, also pointed out that some miners have started selling more tokens to improve their balance sheets and provide funds for capital expenditure to cope with the difficult period of declining profit margins after the halving. He stated, “Scale will become even more important after the halving.”
Although most miners are still long-term holders, their short-term selling behavior does put some pressure on the price of Bitcoin.
However, data analyst DataScope observes the impact of miners’ selling on the Bitcoin market from another perspective. He points out through the analysis of the amount of Bitcoin transferred by miners to exchanges:
DataScope emphasizes that miners’ strategies not only affect the short-term price of Bitcoin but also have an impact on its long-term economic model. Therefore, tracking how miners use their reserves and their behavior in the market is crucial for investors and market analysts.
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