Public bitcoin mining firms have been caught between a rock and a hard place with the decline in bitcoin prices. As their cash flow had declined significantly, they had turned to sell BTC to be able to keep up with the costs of their operations. The massive stash of BTC that these public miners had stacked up during the incredible year of 2021 is now making its way to the market. But they are quickly running out of coins to sell.
Bitcoin Miners Dump Coins
Over the last three months, there have been reports of Bitcoin miners dumping thousands of BTC. The volume of BTC being sold was alarming because they were more than the miners were producing in a month.
On September 2nd, blockchain data aggregation firm CryptoQuant revealed that bitcoin miners had sold about 4,586 BTC in 3 days. At the time, bitcoin’s price was trending just above $20,000, bringing the dollar value of the sale to more than $93 million at the time.
In the month of July, public bitcoin miners had sold off a collective 5,700 BTC. The trend would continue into the month of August as miners continued to offload more questions. By the third week of August, they had dumped more than 6,000 BTC.
By selling their stash of BTC, public bitcoin miners have been able to keep bankruptcy at bay. However, their stash of BTC is not bottomless, and they are running out of coins to sell.
Miners’ Balances Run Low
Public bitcoin miners have now sold a healthy part of their balance sheets at this point. The sales have been understandable given the state of the market, but miners are now facing another problem, and that is the fact that they are running out of BTC to sell. Since they have been selling more BTC than they have been producing, their balances have taken a hit.
Miners running out of BTC to sell | Source: Arcane Research
However, not all miners have followed this trend. In fact, some miners have taken this time to increase their holdings. Riot Blockchain is an example of a public bitcoin miner that grew its holding in the last 3 months by almost 100%. Cleanspark also recorded about a 15% increase in its BTC balances. Meanwhile, contesting the claims in recent reports, Hut 8 has clarified that the company has not sold its stack as mentioned by certain agencies and they currently hold around 8,111 BTC in reserves.
Despite these miners having to sell large quantities of BTC, the majority continue to do well financially. The only one on the list seeing deep financial struggles is Stronghold, and this has to do with the fact that the company did not have much in the way of a large BTC balance, to begin with.
Featured image from Vecteezy, charts from Arcane Research and TradingView.com
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