Miners have sold 25,000 bitcoins since June! The Fed raised interest rates by 75 basis points in July to 94.53%

According to Tradingview data, Bitcoin (BTC) has slowly recovered since falling below the $18,000-mark last weekend. It has been hovering around $20,000 for several days, but it has risen again this morning, breaking the $21,000 mark in one fell swoop. As of the deadline, it was reported at $21,038, an increase of 3.11% in the past 24 hours.

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Miners rush to dump Bitcoin

At the same time, Into the Block, a blockchain data analysis agency, announced data on Twitter that bitcoin miners are eager to sell bitcoin to pay expenses and repay loans. Hovering around $20,000, miners are struggling to break even, with 18,251 BTC shrunk from their reserves since June 14.

In response to the reason why miners are selling Bitcoin, Arcane Research analyst Jaran Mellerud shared data on Twitter and explained that this is because the cash flow of miners is plummeting. Taking the Antminer S19 mining machine as an example, for every 1 Bitcoin mined, only $13,000 is currently being made, which is a full 80% drop from its peak in November last year (at $40 per MWh).

Bitcoin miner profitability has fallen to its lowest level since the fourth quarter of 2020, as the price of bitcoin has fallen about 70% from its all-time high, according to Forbes, compounding the fact that energy prices are rising across the board, leading to the primary cost of Bitcoin miners climbed, while the price of the Bitcoin miners produced fell.

This pressure has forced listed bitcoin miners to sell bitcoin reserves and adjust their computing power expectations. According to data from Arcane Research, the monthly sales volume of listed bitcoin miners remained at around 25-40% of the monthly output in January, February, March, and April this year, but it soared in May. to 100%, which means that listed miners sold almost all of their May output.

Including private sector miners, CoinMetrics data shows that miners have sold a total of about 25,000 bitcoins since the beginning of June, which means that the mining industry has sold almost 27,000 bitcoins per month. A month’s worth of bitcoins.

Markets expect the Fed to raise interest rates by another 75 basis points in July

In addition, to combat inflation that has hit a new high since 1981, the US Federal Reserve (Fed) decided on the 16th to raise interest rates by 3 yards, the largest interest rate hike in 28 years, turbulent financial markets. The Chicago Mercantile Exchange (CME) Fed Watch Tool data shows that the market estimates that the probability of the Fed raising interest rates by 75 basis points at the July interest rate decision meeting also reached 94.53%, and the probability of raising interest rates by 50 basis points is only 5.5%. %.

Federal Reserve Chairman Jerome Powell said at a U.S. congressional hearing on the 22nd that Fed officials expect continued interest rate hikes will be appropriate to ease the hottest price pressure in 40 years, pointing to future rate hikes. The pace will depend on inflation data, which must be brought back to 2%. Any possibility of a rate hike is not ruled out if it proves necessary.

Fed Governor Michelle Bowman called for an aggressive rate hike on the 23rd, supporting a 3-yard rate hike in July. She said that based on current inflation data, I expect another 75 basis points of interest rate hikes at the Fed’s next meeting. is appropriate and could raise rates by at least 50 basis points in the next few meetings.

From another point of view, this also shows that miners can have stronger anti-risk ability by holding mining machines and cryptocurrencies at the same time than directly investing in cryptocurrencies.


Post time: Aug-24-2022