This month of June has been one to forget for Bitcoin and its investors, with the flagship crypto experiencing significant price declines. A recent development shows that Bitcoin miners were largely responsible for these price drops with a wave of sell-offs from them.
Bitcoin Miners Sold At An Alarming Rate
Market Intelligence platform IntoTheBlock revealed in an X (formerly Twitter) post that Bitcoin miners have sold over 30,000 BTC ($2 billion). This is the fastest pace in over a year at which these miners have offloaded their BTC holdings. IntoTheBlock added that this wave of sell-offs has been prompted by the recent halving event, which has tightened the profit margins of these miners.
This last halving event saw miners’ rewards halve from 6.25 BTC to 3.125 BTC, which has ultimately affected their revenue and profitability. Bitcoin’s tepid price action since hitting a new all-time high (ATH) in March has also not helped, with these miners looking to have prioritized their immediate financial stability rather than hoping for more price appreciation from Bitcoin.
This has prompted these miners to offload a significant amount of their holdings, especially to cover operational costs. However, BTC has to bear the brunt of these miners’ capitulation, seeing how the flagship crypto has declined from around $70,000 at the start of the month to below $63,000 at the time of writing.
Crypto analyst Willy Woo also recently highlighted the significance of these sell-offs from miners on Bitcoin, stating that the flagship crypto will only recover once the “weak miners die and hash rate recovers.” He explained that shaking out weak hands would involve the inefficient miners going into bankruptcy while other miners would be forced to upgrade their hardware to more efficient ones.
Whatever happens, BTC’s price is expected to make an impressive recovery once these miners are liquidating their holdings. However, in the meantime, Bitcoin risks further declining and dropping below the psychological level of $60,000 if this massive selling pressure from the miners persists.
Another Reason Why BTC Risks A Further Downtrend
Crypto analyst Ali Martinez recently mentioned that around 5.45 million addresses bought 3.03 million BTC between $64,300 and $70,800. He added that that range forms a significant supply barrier, with BTC risking a “steep correction.” Martinez stated that those holders who bought at that range may offload their holdings to limit their losses, which could further intensify the downward pressure on Bitcoin.
Bitcoinist also recently reported that Bitcoin had dropped below the short-term holders’ realized profit of $66,200. This is significant as BTC’s failure to rebound soon enough could force this category of investors to cut their losses or secure whatever little profit they have left from their Bitcoin investment.
Featured image created with Dall.E, chart from Tradingview.com
