(Kitoko News) – Bitcoin (Bitcoin) miners have become the latest group to come under pressure as conditions in the cryptocurrency market deteriorate. Some risk going out of business unless the top cryptos start to rise in the near future.
Despite the weakness seen across the cryptocurrency market in 2022, the difficulty of Bitcoin mining continues to rise as network hashrates rise due to new mining farms and technological advancements.
data Bitcoin mining difficulty has risen almost unstoppably since July 2021, recently hitting an all-time high of 36.9505 T, according to CoinWarz research. Bitcoin will be blocked, reducing your final income.
The difficulty of mining bitcoin.Source: Coinwards
Miners have been forced to sell their bitcoin holdings at the fastest pace since November 2015 as a result of BTC’s price decline and rising difficulty. data from the glass node.
Bitcoin Miner Balance. Source: Glassnode
Increased sales from bitcoin miners exacerbated bitcoin price weakness. Because they wanted to quickly sell their holdings before prices fell further amid the spread of contagion from the FTX collapse.
As Capriol Fund founder Charles Edwards pointed out, selling pressure has increased by 400% over the past three weeks as the FTX drama unfolded, and if the situation doesn’t improve soon, it could threaten some. Miners may go out of business.
It’s a pool of Bitcoin miner blood.
Most aggressive miner sales in almost 7 years.
400% up in just 3 weeks!
If the price doesn’t rise soon, many Bitcoin miners will go bankrupt. pic.twitter.com/4ePh0TIPmZ
— Charles Edwards (@caprioleio) November 21, 2022
A tweet released by Glassnode highlights that BTC mining profitability is declining year by year as the network’s hashrate rises to all-time highs as the mining business pushes to open up.
#bitcoin The hash price for miners plummeted to an all-time low of $58.3k per Exahash per day.
When $BTC With prices now down more than 76% from their peak, the mining industry remains under enormous pressure.
— Glassnode (@glassnode) November 18, 2022
This increase in selling, coupled with the impact from FTX, pushed Bitcoin’s price to its lowest level since November 2020 and widespread fear drove traders out of the market.
One of the confirmed victims was Bitcoin miner Iris Energy, which decided to unplug most of its mining hardware following default notice on a loan it had secured of about $107.8 million. I was forced.
It was such a momentous event that Twitter user Bitsbetrippin noticed that Bitcoin’s hashrate had dropped significantly and confirmation of new Bitcoin blocks was delayed.
who turned off #bitcoin #btc mining. The last bitcoin block he found was over 30 minutes ago. This represents a 15-25% drop in total Bitcoin hashrate across the network. Someone or a few people on a large scale turned the power off. pic.twitter.com/8OWLX7cRa0
— Bitsbetrippin (@BitsBeTrippin) November 21, 2022
Thankfully, the design of the Bitcoin protocol seems to have plateaued hashrate and difficulty following negative or neutral back-to-back difficulty adjustments, so there could be some relief on the horizon. It suggests that there is a
These developments may also lead to behavioral changes for some Bitcoin miners adopting the mining and hoddle approach.
As pointed out in the followup Tweet From Charles Edwards, “As Bitcoin miners, mining and hoddle is not a viable strategy. . In this market, you need to manage (trade) your bitcoin positions all the time. “
In fact, the Hodl strategy, as it is known in cryptocurrencies, is making a comeback and troubling many investors. data According to IntotheBlock, “For the first time since March 2020, over 50% of Bitcoin holders are losing positions.
While last year’s events shocked many, experienced crypto investors are no stranger to the constant barrage of negative developments coming in the crypto winter. At this point, all you can do is ride out the storm in the hope that one day soon winter will turn into spring.
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