Bitcoin (BTC) has experienced a sharp decline of 4.5% over the past week, dropping to a monthly low of $65,000. This significant decrease in the value of the digital asset can be attributed to the heightened selling pressure from Bitcoin mining entities. According to the latest CryptoQuant weekly report, analysts have observed a surge in the number of BTC being sent from mining entities to exchanges, reaching a two-month high. This surge in selling activity comes at a time when mining revenues have been declining due to lower transaction fees.
On June 9, the amount of BTC transferred hourly from the btc.com mining pool to the popular crypto exchange Binance hit a two-month high of over 3,000 BTC. The following day, miners sold a minimum of 1,200 BTC through over-the-counter desks, marking the highest daily volume since late March. Major Bitcoin mining companies, including U.S.-based Marathon Digital, have also ramped up their selling activity. Marathon Digital has sold 1,400 BTC in June alone, representing 8% of its total holdings. This is a significant increase from the 390 BTC it sold in May.
The increased selling pressure from Bitcoin miners comes as their revenues continue to decline post-halving. Daily miner revenues have plummeted to around $35 million, a stark 55% decrease from the peak of $78 million seen in March. Daily Bitcoin transaction fees have also dropped significantly to around 65, down from 117 prior to the halving. Despite a surge in network transactions, median transaction fees have remained low in USD terms.
While miners are selling more BTC to compensate for lower revenues, the Bitcoin network’s hashrate has remained high. Since the halving in April, the hashrate has only decreased by 4%, adding more pressure on miners. A high hashrate indicates that miners require more computing power, energy, and time to validate transactions and add blocks to the blockchain. With the current hashrate standing at 599EH/s, slightly lower than the pre-halving rate of 622 EH/s, miners are now competing for reduced block rewards under immense pressure.
According to CryptoQuant analysts, a period characterized by low miner revenues and a high hashrate often signifies price bottoms for Bitcoin. It remains to be seen how low BTC will drop before the market sees a resurgence. The ongoing selling pressure from mining entities, coupled with the challenges posed by reduced transaction fees and high hashrate, could continue to impact Bitcoin’s price in the coming days. Investors and traders are closely monitoring these developments to gauge the market’s direction and anticipate potential buying opportunities.
