According to the financial reports of listed mining companies, they had to sell four times the amount of cryptocurrencies in order to continue to operate economically.
In May 2022, listed mining companies sold 4,411 Bitcoins. This is four times as much as the average for the months of January to April 2022, according to the financial reports available to the regulator.
Bitcoin Mining: Companies are Selling More Bitcoin
Bitcoin Mining Statistics from NYDIC
Data from the analysis company CoinMetrics also confirm that crypto miners have begun to move coins to their wallets on crypto exchanges. There is no 100% certainty about the reasons behind the sale.
Initially, miners received 50 BTC for each complete block. But since the amount is halved every four years, the reward is now only 6.25 BTC. On average, a new block is mined every 10 minutes, which gives about 900 bitcoins per day. Furthermore, miners receive a reward for the verification of transactions.
With the appropriate Bitcoin rate, the miners earn enough money to pay for the electricity and cover other operating costs. That is why the Bitcoin miners accumulate their BTC frequently during this phase.
But now the situation is different: Electricity prices are rising and miners’ profits are falling along with the value of cryptocurrencies. Under these conditions, companies are forced to exchange BTC for fiat in order to pay electricity and salaries of employees.
Mining is less profitable
At the end of May, there were about 46,500 BTC (then worth $ 1.5 billion) in the miner wallets. The companies will probably have to continue to increase their sales in order to be able to finance Bitcoin mining.
As a result of the miners’ sales, the volume of coins in circulation will increase, and with it the selling pressure on the market.
At the time of publication of this article, the Bitcoin rate is at $ 20,108. Previously, the figure had fallen to $ 18,700 – this is the lowest figure since December 2020. The market capitalization of digital assets was only $ 880 billion, losing more than $ 500 billion in a week.
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