As Bitcoin’s value hits an 18-month high of $37,000, marking a stellar rise of over 100% year-to-date, top Bitcoin miners have made a surprising move. Significantly, they sold 5,492 Bitcoins, withdrawing around $164 million. This number dwarfs the amount they produced, clearly showing their sales strategy during the cryptocurrency rally.
Strategic sales increase for the mining company
Miners like Marathon Digital Holdings and Core Scientific Inc., caught up in the excitement over Bitcoin’s major rally, opted for a strategic sell-off. MinerMag data reveals a liquidation/production ratio of 105% in October. Consequently, the miners not only sold the month’s proceeds but also tapped into the reserves. This approach marked a notable increase from the previous quarter’s more conservative ratios of 64%, 77% and 77%.
Furthermore, amid last year’s market crash and rising energy costs, the ratio skyrocketed to 390% in June, demonstrating the volatile nature of the crypto economy. Figures from October this year suggest that mining companies are seizing the moment, benefiting from rising prices.
Preparing to Halve Bitcoin
Furthermore, this sales trend is about more than just capitalizing on a price increase. Miners are preparing for the upcoming halving event, a significant update to the Bitcoin code. The Bitcoin halving is a quadrennial recalibration designed to maintain the token’s scarcity by capping supply at 21 million.
Furthermore, Bob Burnett, CEO of Barefoot Mining, predicts a 52.2% reduction in miner rewards after the halving. However, he remains optimistic, suggesting that rising transaction fees could boost the industry, with daily Bitcoin production potentially exceeding 900 BTC by 2027. Consequently, selling now is also a tactical move for miners. strengthen their financial protection against the expected drop in mining revenues.