Bitcoin miner revenues have been plummeting ever since the price of BTC peaked back in November. This has put miners in a tight spot, causing a good number of them to sell their BTC holdings in order to keep financing their operations. The same was the case for last week, where miner revenues were once again in the red. However, as the tide begins to change in the crypto market, there may be light at the end of the tunnel for miners.
Miner Revenues Down 4%
For the past month, daily miner revenues have been trending above $18 million but continued recording losses with each passing week. Last week would put an end to this trend when miner revenue fell once again, this time by 4.03%, causing average daily revenues to drop below $18 million. Reports show that miners saw an average of $17.7 million in revenues, more than 60% down from its peak back in November.
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What followed this was a sell-off from bitcoin miners across the space. As the profitability plummeted, more BTC had to be offloaded by miners to provide cash flow for their operations. In June alone, miners had sold off 25% of their holdings, and with the prices remaining low, reports for July are expected to show even higher sales for the month of July.
For the last two months, bitcoin miners have been selling more BTC than they were producing. For the month of May, they had sold more than 100% of the BTC produced. This number had jumped 400% in June when public miners sold approximately 14,600 BTC when they had only produced a total of 3,900 BTC, accounting for 25% of all of their holdings.
BTC drops to $22,700 | Source: BTCUSD on TradingView.com
Surprisingly, fees per day were up 12.61% last week, which brought the percentage of revenue gotten from fees to 2.59%, a 0.38% increase from the prior week.
Will The Bitcoin Rally Help?
The recent rally in the market has seen the price of bitcoin reclaim key technical levels and reach one-month highs. The digital asset had even briefly touched above $24,000 before trending back down, and the first half of the week had been green for the digital asset.
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Since the profitability of bitcoin mining is directly tied to the price of the digital asset, it is safe to assume that there may be some uptick in miner revenues for this week. Given that price was trending around $19,000 for most of last week, an increase above $22,000 will see public bitcoin miners realize more revenue from their mining operations.
However, given that the price had not recovered by a wide margin, the rise in daily miner revenue is expected to remain under double-digits. It is also important to note that there is more demand for block space, leading to higher transaction fees on the network, contributing more to the daily miner revenues.
Featured image from GoBankingRates, chart from TradingView.com
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