Bitcoin miners can’t bear market pressure, sell to survive
Core Scientific, the largest publicly traded mining company, reported its results for the first half of 2022. Of particular interest was the fact that miners sold 7,202 BTC in June for an average price of $23,000, while the total proceeds from the sale amounted to $167 million. As of the end of June, the company had 1,959 BTC and $132 million in cash on its balance sheet. Thus, we can say that Core Scientific has sold over 78.6% of all its bitcoin reserves.
The miners then explained that the proceeds from the sale were used to pay for the ASICs for servers, capital expenditures for additional data centers, and debt payments. Meanwhile, the company plans to deploy an additional 70,000 ASIC servers during the rest of the year, with 103,000 already at its disposal. Core Scientific has also said that it will continue to sell mined BTC to pay for operating costs and provide adequate liquidity.
What does this mean for the crypto market?
For the answer to this question, we suggest turning to Will Clemente, principal analyst at Blockware Solutions, who successfully Predicted Such sales from miners in mid-June.
Bitcoin’s low price, high hash/difficulty and high energy costs put severe pressure on miners’ margins. Hashprice is the lowest level since October 2020.
The hash ribbon is crossed (bot left), indicating that the machine is unplugged + miners are sending BTC to exchanges. (bot. right) pic.twitter.com/x7J7pYTZ9W— Will Clemente (@WClementeIII) 18 June 2022
According to Clemente, the low price of bitcoin, along with the high complexity of mining and high energy costs, put a lot of pressure on miners’ trading margins. The graphs cited by the analyst on June 18 show that the hashrate price is falling more than the bitcoin price, and the intersection of the hash ribbons on the graph clearly shows the decline of the machines working, Which is further supported by increased sales of BTC by miners. ,