Mining Operators Fret As Bitcoin Looses Ground, What Lies Ahead For The Mining Community
June 30 2022 - 9:00AM
NEWSBTC
Bitcoin and other altcoins have suffered massive losses since May.
But after a point, things started changing a bit. For example,
bitcoin that fell to $17K on June 18 recovered to trade between
$20K and $21K from June 19 to June 28 when it traded above $21K in
the early hours of the day. Unfortunately, the crypto could not
sustain the recovery above $21K and lost more than $500 some hours
later. The change in Bitcoin price resulted from mixed reactions in
the market concerning regulators’ stance on crypto. According to
Gary Gensler, the SEC boss, regulators place Bitcoin and other
tokens under commodities. Gensler mentioned that a spot Bitcoin ETF
might not be the best for the financial market. So, the commission
will not approve any application filed to launch a spot BTC ETF.
Related Reading | Outflows Rock Bitcoin As Institutional
Investors Pull The Plug, More Downside Coming? The Securities and
Exchange Commission boss made all these assertions when a media
firm interviewed him. After the interview, many Bitcoin holders
started selling off again, causing a fall in Bitcoin price. Many
Bitcoin Holders Grab More Coins During the market crash and price
plunge, many investors wondered whether to sell off or buy more to
increase their portfolio. However, according to Glassnode data
recently, some Bitcoin holders believe this market crash is the
right time to buy more BTC. The firm disclosed the data over the
weekend on Twitter, revealing that more than 100 whale addresses
are buying more Bitcoin this period. The data showed that these
whales grab these coins at a discount due to the present panic in
the market. Also, Glassnode noted that the current trend might last
long. Another indicator showing interest in buying more among the
whales is the amount of BTC in several wallets. And the addresses
that had from 10BTC to 10,000BTC have added more coins in two
weeks. Then those wallets above 10,000BTC have grown since the
second month of 2022. Miners Feel The Strain The crypto winter of
2022 also affected miners terribly. They are trying to make a
profit which hasn’t been easy due to the bear market. Many miners
have given up their equipment to reduce pressure. An analysis by
strategists has shown that miners in the public sectors are
responsible for 20% of miners’ sales between May & June. They
also indicated that it might be the same for the private sector
miners. But then, miners struggle to pay back the $4 billion loans
collateralized by their mining equipment. According to a report,
many miners have defaulted on the loan agreement, while others show
weakness. Related Reading | Ethereum Fees Touch Monthly Lows
As Transaction Volumes Plummet The reason is that the bear market
has crashed the value of the mining rigs used as collateral. As a
result, the loan increases since the collateral worth now no longer
matches the loan amount. Featured image from BBC, charts from
TradingView.com
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