Bitcoin Miners Liquidating Holdings as BTC Price Recovers
Following the introduction of Bitcoin ETFs in Hong Kong, Bitcoin experienced a modest 2% recovery, surpassing $63,300. However, recent on-chain data reveals that Bitcoin miners are increasingly liquidating their holdings.
According to Cryptoquant, an on-chain analytics company, a significant amount of Bitcoin has been moved from miners to spot exchanges. This suggests a potential market imbalance, as there has been a substantial influx of Bitcoin from miners to spot exchanges.
The liquidation of holdings by miners is a logical move to cover operational costs, especially after the Bitcoin halving event. Despite no change in pricing, miners are now earning approximately half as much Bitcoin as they were a few weeks ago.
Miners play a vital role in validating and securing the Bitcoin network by utilizing power and funding expenses such as hardware, rent, and wages. In return for their efforts, miners are rewarded with Bitcoin.
The declining profitability of miners could potentially impact Bitcoin’s price. However, experts advise against panicking solely based on this data and recommend monitoring the situation over time.
This week marks significant economic events in the United States, with the Federal Reserve’s highly anticipated interest rate decision taking place on May 1. The majority of analysts (95.6%) expect the Federal Reserve to maintain the current interest rates. Additionally, the US will announce the unemployment rate for April on May 3, with only one interest rate cut anticipated for this year.
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