For the longest time, bitcoin miners kept the spoils of their activities. That was when the profitability of cryptocurrency mining was still high. Due to the high cash flow, these miners were able to keep a large portion of their rewards while still being able to carry out their operations. However, recent market trends have dampened the profitability of bitcoin mining, prompting miners to start dumping bitcoin stocks and selling to keep operations alive.
Bitcoin miners are selling
A large number of bitcoin miners held large bags mostly through the bear market. With the market shifting and bitcoin now trading below $29,000, it has become increasingly difficult for miners to hold these coins without compromising their ability to fund their operations. As a result, a number of prominent bitcoin miners have emerged to say that they have sold or will sell some of the bitcoins they own.
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There is no doubt that Marathon Digital is one of the first names that come up when the topic of Bitcoin mining comes up. The company was able to establish itself as a major competitor in the mining world and attracted a large number of investors but even the large companies were not able to escape from the onslaught of the market.
Last month, the company announced during an earnings call that it may have to sell some of its bitcoin holdings. Marathon Digital owns more than 9,600 bitcoins, and has held most of them for about two years. However, it appears that the day of reckoning is fast approaching, and even large companies will have to dump some of their bitcoins.
BTC continues to struggle as sell-offs intensify | Source: BTCUSD on TradingView.com
Companies that have already sold some of their bitcoins include Riot and Cathedra Bitcoin. Reportedly, Riot sold nearly $10 million worth of bitcoin in April, which came to a total of 250 bitcoins. Recently, Cathedra had Bitcoin announce It sold 235 bitcoins at an average price of $29152. It has grossed just over $8.7 million. The company explained in its report that this was to help it insulate itself from further declines in the price of Bitcoin and maintain its liquidity position.
Mining is no longer profitable?
Bitcoin mining is still profitable but with the price down more than 50% from its all-time high, profitability has fallen by a huge margin. a Report from Bitcoinist He highlighted the profitability of BTC mining machines. Miners are now returning 50% less cash flow than they did when BTC was trading at $69,000.
Related reading | Bitcoin Initially Settling Above $31,000, Bull Rally or Trap?
In addition, miners’ daily earnings are still low. It grew by 4.50% last week to fall at $26,706,581 but this is still low. It is a result of the average transaction value and daily transactions that have decreased over the past week.
Belief in bitcoin mining stocks is also declining. So far, miners have been forced to sell some of their bitcoin holdings to be able to continue their operations.
Featured image from Outlook India, chart from TradingView.com
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