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Bitcoin miners face worst time in seven years; reason is quite surprising

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The current situation is difficult for Bitcoin miners. Assets are being sold at a faster pace and corporate stock prices are falling. The pressure on Bitcoin miners has never been higher than on November 22, when the Bitcoin price hit another bear cycle low.

Capriole Fund founder Charles Edwards has noticed Bitcoin miners selling off. Actively on November 21st. As can be seen on the chart, the sell is up 400% so far this month. he said,

“This is also the most aggressive sell in almost seven years. If the price doesn’t rise soon, many Bitcoin miners will go bankrupt. “

hash rate goes up

Currently, Bitcoin miners are dealing with three problems at once. As the hash rate approaches peak levels, it becomes difficult to mine the next block. This is bad for miners, but good for network security. According to blockchain.com, the network hash rate is currently 261 EH/s (exahash per second). It peaked at 273 EH/s on November 2nd.

Moreover, energy costs are still very high in most cases. Excessive power costs can significantly reduce profit margins. As a result, many Bitcoin miners have shut down their facilities or ceased operations altogether.

Most recently, Australian company Iris Energy was forced to shut down hardware after defaulting on $108 million in debt.

Publicly traded mining businesses are in a similarly difficult situation at the moment due to falling share prices. Canaan Inc.’s stock plunged to his two-year low of $2.52 in after-hours trading, according to Market Watch. Trading volumes for Bitcoin mining stocks hit record lows as the crypto winter rages on.

Prices Influencing Bitcoin Miners

A third factor that harms miners is the price of Bitcoin. According to CoinGecko, the asset fell to $15,650 on Nov. 22, its lowest since November 2020.

Bitcoin hit a two-year low as investors slashed the price of most cryptocurrencies on Nov. 22 as FTX’s collapse threatens to bankrupt other businesses on the platform.

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