The top five Bitcoin mining companies aren’t offloading their BTC stocks, in contrast to expectations, with the imminent Bitcoin halving bringing about a 50% decrease in new supply issuance.
In Q1 2024, the top five Bitcoin mining companies saw their sales reach a two-year minimum, selling around 2,000 BTC collectively as reported on April 10th by Bitwise.
In Q1 2022, the leading five Bitcoin miners disposed of fewer than 2,000 Bitcoins collectively. Contrastingly, they sold more than 7,000 Bitcoins combined in Q4 2023.
The report is released just prior to the upcoming Bitcoin halving in 2024, an event that will decrease the reward for mining a Bitcoin block from 6.25 Bitcoins to 3.125 Bitcoins.
As the Bitcoin hash rate continues to rise, mining companies may experience a decrease in profits following the halving event.
Although some miners faced a pessimistic forecast, Bitcoin mining income experienced a notable surge, rising by approximately 30% from the previous quarter. This marked a significant leap, surpassing the $1.5 billion lows reached in the final quarter of 2022. Consequently, Bitcoin miner revenue exceeded $4.5 billion based on Bitwise’s data.
Although the imminent reduction in new bitcoins generated through mining may not result in a decrease in mining income when expressed in US dollars, as per Laurent Benayoun, the CEO of Acheron Trading.
“In dollar terms, it’s not obvious that miners would be worse off after the halving, quite the opposite […] The decrease in mining rewards is going to be compensated by an increase in network fees.”
After a Bitcoin halving event, mining revenue for Bitcoins tends to decrease. For instance, there was a 40% drop in revenue the month following the 2020 halving, while mining revenues declined by over 51% after the 2016 halving.
Among the leading five Bitcoin mining companies, Marathon Digital was the top producer in Q1 2024, generating approximately 2,500 Bitcoins. However, this figure represented a significant decrease from the over 4,000 Bitcoins they mined in Q4 2023.
Despite Marathon Digital having the highest mining costs on average at $22,249 per BTC in Q1 2024, Cipher Mining managed to keep their costs significantly lower at an average of $8,626 per BTC. Meanwhile, Bitcoin‘s average price hovered around $53,534 during the same period.
Approximately 700,000 Bitcoins, owned by miners around the globe, represent around 3.4% of the entire Bitcoin inventory. In contrast, about 57% or roughly 12 million Bitcoins are in the possession of individual holders, based on data from Bitwise.
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2024-04-17 16:08