- As a result of the most recent halving of Bitcoin, miners are under pressure to sell their shares as their earnings decline, claims Kaiko.
- May saw a decline in miners’ earnings as transaction fees decreased and lower token incentives from bitcoin mining were received.
According to data from the cryptocurrency research and analytics company Kaiko, a significant bitcoin selloff is probably imminent since the token’s miners are under pressure to sell their holdings due to a sharp decline in revenue.
The two main sources of income for bitcoin miners are transaction fees and mining rewards.
These companies are, nevertheless, making less money these days.
The long-ago implemented fall in mining incentives from 6.25 BTC to 3.125 BTC in April created a special challenge for miners striving to meet their overhead.
According to a recent study by Kaiko researchers, the halving has historically been a selling event for Bitcoin miners because the cost of mining new blocks is high and forces miners to sell in order to pay for expenses.
The transaction fees miners charge to expedite traders’ transactions are also diminishing, which is their second source of income. The income that miners made from transaction fees in the first week of May continued to be less than the money they made from mining bitcoin.
The cryptocurrency market may be significantly impacted by a possible sell-off in bitcoin, particularly during a period of reduced market liquidity. According to Kaiko, mining firms like Marathon Digital, which is valued at $1.1 billion in bitcoin, would only need to liquidate a small portion of their holdings to cause significant market swings.
Disclaimer : This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments.
