Miners are selling their bitcoin as it struggles to hold $70,000

Signs of miner capitulation are emerging as bitcoin struggles with the $70,000 level. According to data from CryptoQuant, the flow of bitcoin leaving miners’ wallets to exchanges – indicating a sell-off event – ​​reached the highest level in two months last weekend. Additionally, miner sales at OTC desks recorded their highest daily volume since the end of March. “Miners are now competing for 450 bitcoins a day across the network, up from 900 less than two months ago,” or post-halving, said Mike Colonnese, an analyst at HC Wainwright. “While rising transaction fees have helped offset some of this impact, the mining economy is effectively down 45% compared to previous levels, so we are not surprised to see some of this strength being sold into the market… as miners effectively seek to cover operating expenses and, to some extent, capex with the proceeds of these bitcoin sales.” CryptoQuant shows that hourly bitcoin transfers from miners to exchanges increased to more than 3,000 bitcoins on June 9. The next day, miners sold 1,200 bitcoins at over-the-counter tables. The cryptocurrency’s price fell to around $66,000 on June 11. Bitcoin has struggled to break the $70,000 level since hitting its all-time high of $73,797.68 on March 14. “[The] sales came in a context of low revenues after the halving,” said CryptoQuant’s head of research, Julio Moreno. “Bitcoin miners’ daily revenues are today at around $35 million, a 55% drop compared to to the 2024 peak reached in March.” a result of “depressed” transaction fees, however, rather than the miners’ block reward reduction at halving. He said the Bitcoin network’s total daily transaction fees are more than 44% lower than they were before the halving and this, even with the halving record transactions on the network, the average transaction fee has remained low. Furthermore, the hash rate of the Bitcoin network has barely dropped since the halving in. April 19, Moreno added, competing for a decreasing amount of block rewards, placing additional pressure on miners’ profitability,” he said. Colonnese said large publicly traded miners are in good shape following the halving. His main choices are CleanSpark and Iren, the former Iris Energy. “We estimate that the group is currently generating gross margins in excess of 50% with bitcoin at US$70,000, while we estimate the total cash cost of producing one bitcoin for the group to be around US$45,000 on average,” he said he. “Therefore, the large listed miners have plenty of breathing room.” CleanSpark fell 19% for the quarter, while Iren rose more than 140%. They gained 55% and 82% for the year, respectively. “On the other hand, smaller bitcoin businesses with less efficient fleets, higher energy costs, and less access to capital are really starting to feel the burn and may struggle to survive in the coming months unless bitcoin prices experience a significant price recovery. in the short term, which is currently not our base case,” he added.

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