Bitcoin maximalist Tuur Demeester presents new data to suggest that miners are selling less Bitcoin. Data from crypto analytics firm Glassnode shows that most miners are holding while struggling miners have little Bitcoin to sell.
According to Demeester,
“Healthy bitcoin miners are hodling, and struggling miners have little BTC left to sell. Bullish.”
Glassnode’s Miner Outflow Multiple (MOM) for Bitcoin shows that outflows for the cryptocurrency from miner pools are approaching a new lows of the year. The MOM takes into account a 365-day moving average.
On 11 May, the block rewards fell by 50% to 6.25 BTC which led to revenue of miners reducing by 48%. With the fall in revenue, miners were under more pressure to maintain profitability.
Contrary to popular belief, miners may not always offload inventory in market conditions they determine as unsatisfactory. Many were led to believe that this will be the most brutal Bitcoin halving in history with production costs set to double for miners.
A previous report by ByteTree, shows that miners sold more Bitcoin. Miners sold 920 in BTC and generated 844 BTC over 24 hours, reducing their inventory by 76 BTC. As a result, the miner’s rolling inventory (MRI) figure was kept above 100%.
Charlie Morris from crypto-data analytics firm Bytetree says,
“(Miners) HODL when the market is weak, not because they are bullish, but because the market can’t take it. When they can sell, it is an indication that the market is well supported.
Miners are highly dependent on Bitcoin rewards for their operations. Coupled with costly set up costs, electricity prices continue to threaten the profitability of miners. Players in the industry also have to worry about around-the-clock labor maintenance, temperature control, and other variables.