Bitcoin Miners Holding onto Holdings Despite Revenue Drop: CryptoQuant
Bitcoin miners are facing a tough decision as their revenue has dropped to levels last seen in early 2023 following the recent halving. Despite this, they are holding onto their crypto holdings rather than selling, according to CryptoQuant.
The halving, which reduced fixed block rewards from 6.25 BTC to 3.125 BTC, has put pressure on miners’ profitability. However, CryptoQuant CEO Ki Young Ju stated that miners have two options: capitulate or wait for a rise in Bitcoin’s price, which is currently trading at around $63,000. Ju added that there are currently no signs of capitulation among miners.
Analysts at Coinbase Research also noted that the coordinated release of Runes on Bitcoin, an alternative to the BRC-20 protocol, resulted in an all-time high of $81 million spent on transaction fees in one day. This increase in variable transaction fees, along with the BTC rally during Q1, could support the continued growth of network hash rate, making it profitable for miners to continue participating in BTC mining at current price levels.
Bitcoin underwent its fourth halving on Apr. 20, reducing the block reward by half. This event is significant as it affects the supply of new Bitcoins entering circulation. Historically, Bitcoin’s price has experienced significant movements around halving events, with some investors anticipating a price increase due to the reduction in supply. However, the latest halving occurred in a different context, with Bitcoin reaching a new all-time high even before the event, leading to discussions about the evolving landscape compared to previous cycles.
