Despite the drop in revenue for Bitcoin miners to levels last seen in early 2023, they are holding onto their holdings rather than selling, CryptoQuant says.
Bitcoin miners are not selling their crypto holdings at current prices even though their revenue has dropped to levels last seen in early 2023 due to the recent halving, which reduced fixed block rewards from 6.25 BTC to 3.125 BTC.
#Bitcoin miners’ revenue has dropped to levels seen in early 2023 following the halving.
Now they have two options: 1. Capitulation, or 2. Waiting for a rise in $BTC price.
There are no signs of capitulation for now. pic.twitter.com/8GrYk7zcN1
— Ki Young Ju (@ki_young_ju) April 30, 2024
In an X post on Apr. 30, CryptoQuant CEO Ki Young Ju said that miners now have two options: capitulate or wait for a rise in Bitcoin’s price, which is currently trading at around $63,000, adding that “there are no signs of capitulation for now.”
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Analysts at Coinbase Research noted in a research report that following the halving, the coordinated release of Runes on Bitcoin, an alternative to the BRC-20 protocol, resulted in “an all-time high of $81 million spent on transaction fees in one day.” The analysts say the increase in variable transaction fees in conjunction with the BTC rally during Q1 “could support the continued growth of network hash rate for some time,” suggesting miners may find it profitable to continue participating in BTC mining at current price levels.
Bitcoin underwent its fourth halving on Apr. 20 after its 840,000th block was mined. The network is programmed to undergo halvings every 210,000 blocks, reducing the block reward by half each time. This event is considered by the crypto community as significant as it affects the supply of new Bitcoins entering circulation.
Historically, Bitcoin’s price has experienced significant movements around halving events, with some investors anticipating a price increase due to the recent reduction in supply. However, the latest upgrade occurred in a different context, as Bitcoin reached a new all-time high even before the halving took place, leading some to argue that the landscape has evolved compared to previous cycles.
Read more: Hut 8 CEO forecasts decline in Bitcoin mining bankruptcies amid scale shift
