An industry-reputable crypto analysis firm has predicted that miners will carry on selling more Bitcoin than they earn.
As Bitcoin’s prices fell earlier this year, there has been decreased pressure on increasing the supply of the token. This has meant that the Bitcoin mining sector had struggled with some production costs sitting higher than the price of Bitcoin. To combat the decreased value, miners have had to sell more of their cryptocurrency to keep up with production and stay in business. Some miners have had to cut their mining activity completely to avoid losing too much money with the costs associated with mining.
Data from Arcane Research has shown that miners in the industry have been under immense pressure to sell, with one miner selling approximately 21,000 BTC between May and July. The only way this trend will reverse – and miners will start storing and reducing their selling – is if Bitcoin prices start to increase again.
Bitcoin’s price has increased steadily from the lowest point it hit in June. However, the price is still 65.5% slashed from the all-time high it saw in November 2021. Until it increases more, it will take the pressure off miners to sell.
According to an analyst at Arcane, Jaran Mellerud, miners are selling, but the rate of sales has slowed down since June:
“Even though the public miners sold less than half the amount in July as in June, we still see that they are draining their holdings if we look at the percentage of the bitcoin production sold. The public miners sold 158% of their Bitcoin production in July, making it the third month in a row where they sold more than 100% of production.”
“I expect the selling pressure to continue at between 100% and 150% of production unless something significant happens to the Bitcoin price. This is equivalent to between 4,000 and 6,000 BTC per month.”