Thursday, June 02, 2022 10:18:18 AM
As the price of bitcoin falls, miners are cornered into powering off or selling their holdings.
By Eliza Gkritsi, Aoyon Ashraf
Jun 1, 2022
CoinDesk
Bitcoin miners at work (Sandali Handagama)
Bitcoin miners are selling off their mined tokens as the tumbling price of bitcoin erases profit margins at the same time capital markets are becoming less friendly.
CoinDesk - Unknown
Bitcoin miners are selling off their mined digital assets. (Compass Mining)
Miner flows to exchanges have reached their highest point since January, Compass Mining – a bitcoin mining services company – wrote in a research note today using data from CoinMetrics. "Miners may begin to sell hodl'd Bitcoin into the open market," wrote Compass. "At the very least they are feeling the pain after the last major dip in price. Couple this with a downwards difficulty adjustment – indicating miners powering off – and it seems miners may be hitting a wall in profitability."
Mining bitcoin (BTC) has become less profitable as the price of the crypto has trended downwards, with popular machines like Bitmain's Antminer S9 becoming money losers at electricity prices of six cents per kilowatt hour. Struggling miners who would prefer not to shut down their rigs can look to raise capital in the debt or equity markets and/or sell off bitcoin holdings.
Argo Blockchain (ARBK) plans to raise debt and sell some of its bitcoin to cover expenses, the company said in an analyst call for its first quarter results. Core Scientific (CORZ), the world's largest miner by hashrate, has already sold some of its mined bitcoin this year and plans to continue doing so. Previously a confirmed HODLer, Riot Blockchain (RIOT) sold nearly half of its mined bitcoin in April after having also sold a sizable amount in March.
Cathedra Bitcoin in a May 30 statement said it sold 235 bitcoins during the month in a move to raise liquidity and "insulate" itself from further price declines. The company also had a tough April, operating at 45% of expected hashrate throughout the month thanks to storms affecting its North Dakota site.
There's also Marathon Digital (MARA), which – at its earnings call in early May – suggested it may sell some of its bitcoin.
The most recent note comes from Toronto-based Digihost, which today said it sold off a portion of its mined bitcoin to help fund energy costs.
Successful Trading is the art of minimizing long term risk and maximizing capital allocation.
Recent CORZ News
- Core Scientific Announces Fiscal First Quarter 2024 Results • Business Wire • 05/08/2024 08:10:00 PM
- Core Scientific Announces April 2024 Production and Operations Updates • Business Wire • 05/06/2024 01:10:00 PM
- Core Scientific, Inc. Schedules First Quarter Fiscal Year 2024 Earnings Release, Conference Call and Webcast • Business Wire • 05/03/2024 01:10:00 PM
- Core Scientific to Expand its Denton, Texas Bitcoin Mining Data Center by 72 Megawatts • Business Wire • 04/16/2024 01:10:00 PM
- Core Scientific Files Registration Statement for Shares Held by Existing Shareholders • Business Wire • 04/15/2024 01:10:00 PM
- Core Scientific Announces March 2024 Production and Operations Updates • Business Wire • 04/05/2024 01:10:00 PM
- Core Scientific Announces Fiscal Fourth Quarter and Full Fiscal Year 2023 Results • Business Wire • 03/12/2024 08:10:00 PM
- Core Scientific to Provide CoreWeave up to 16 MW of Data Center Infrastructure to Support AI and HPC Workloads in Long Term Hosting Contract with Potential Revenue of More than $100 Million • Business Wire • 03/06/2024 09:10:00 PM
- Core Scientific, Inc. Schedules Full Fiscal Year 2023 Earnings Release, Conference Call and Webcast • Business Wire • 03/05/2024 09:30:00 PM
- Core Scientific Announces February 2024 Production and Operations Updates • Business Wire • 03/05/2024 09:19:00 PM
- Core Scientific Announces January 2024 Production and Operations Updates • Business Wire • 02/05/2024 02:10:00 PM
- Crypto: Core Scientific’s Nasdaq Return, Meta Faces Digital Asset Investigation, and More • IH Market News • 01/24/2024 06:11:16 PM
Avant Technologies Equipping AI-Managed Data Center with High Performance Computing Systems • AVAI • May 10, 2024 8:00 AM
VAYK Discloses Strategic Conversation on Potential Acquisition of $4 Million Home Service Business • VAYK • May 9, 2024 9:00 AM
Bantec's Howco Awarded $4.19 Million Dollar U.S. Department of Defense Contract • BANT • May 8, 2024 10:00 AM
Element79 Gold Corp Successfully Closes Maverick Springs Option Agreement • ELEM • May 8, 2024 9:05 AM
Kona Gold Beverages, Inc. Achieves April Revenues Exceeding $586,000 • KGKG • May 8, 2024 8:30 AM
Epazz plans to spin off Galaxy Batteries Inc. • EPAZ • May 8, 2024 7:05 AM