Bitcoin Miners Reap Profits as BTC Price Hovers around $43K: Is it Influencing the Market?
Summary:
Bitcoin miners are potentially among the largest beneficiaries as Bitcoin (BTC) price hovers around $43,000. Data shows constant offloading since mid-October, with decline in miner-held BTC by 700 units on 28th December. This has sparked debates on whether miner activities are influencing Bitcoin's price. Furthermore, with block subsidy halving eyed by market participants, there's a possibility of miners hoarding BTC stocks. In 2024, Bitcoin's inflation rate is predicted to drop to half that of gold, suggesting a potential surpassing of gold as the optimal store of value.
Recent data exhibits that Bitcoin (BTC) miners may be reaping substantial profits as the cryptocurrency negotiates a price around $43,000. Recent statistics from digital ledger analysis company, Glassnode, highlight a continuing trend of large-scale selling as the year draws to a close. Starting from mid-October, there has been a consistent decrease in the amount of BTC held by Bitcoin miners. As of December 28, the latest data available, miner-held BTC fell by 700 units. Compared to a high point recorded on October 22, miner balances have dwindled by 12,700 BTC.
In this interval, the BTC to USD exchange rate rose from $30,000 to nearly $45,000, and then levelled off towards the end of the year. Recognized trader and social media influencer, Ali, speculates that miner activities could possibly be exerting pressure on the probability of a continued bullish trend. Based on data from crypto-analytics platform, CryptoQuant, Ali described the shrinking balances as "significant." The last 24 hours has seen Bitcoin miners selling more than 3,000 Bitcoin, equating to almost $129 million. This could potentially impact the price of Bitcoin.
The final quarter witnessed a sizeable surge in revenues for miners due to a rise in price to the highest levels since April 2022 coupled with increased transaction rates. Charles Edwards, founder of Capriole Investments, a quantitative fund focused on Bitcoin and digital assets, underlined the impressive profitability in the sector at present.
According to Edwards, "Bitcoin miners are tearing it up," pointing out that the mining price of $64,000 allows for a 50% surplus over the Bitcoin price. The provided chart reveals the balance between production expenses and profit margins per Bitcoin, as per Capriole's documentation.
Market observers are paying close attention to the imminent block subsidy halving, which is viewed as a significant milestone in Bitcoin's existence. Filbfilb, co-founder of DecenTrader, speculates that miners may seek to stockpile BTC in anticipation of the block reward being slashed by 50% to 3.125 BTC. Edwards labelled the April halving event as the "most critical" and a "turning point.”
“In 2024, the inflation rate of Bitcoin will halve to that of gold, and hence, surpassing gold as the superior store of value,” Edwards informed Cointelegraph. The readers are advised to perform their own due diligence before participating in the investment or trading activities since every financial move carries inherent risks. This write-up does not offer investment guidance or suggestions.
Published At
12/29/2023 2:49:45 PM
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