Bitcoin miners have managed to maintain stable reserves in February, despite significant outflows from mining pools to crypto exchanges. According to data from CryptoQuant, as of February 28, miners’ wallet reserves held approximately 1.828 million Bitcoin (BTC), which is only slightly different from the 1.827 million held on February 1.
Although the holding levels remained consistent, recent fluctuations in the price of BTC resulted in substantial sales from miners. On February 26, at least 40,000 BTC were sold as the cryptocurrency’s price surpassed $52,000. This information was revealed by CryptoQuant.
Over the past seven days, Bitcoin’s price has increased by 22%, supported by inflows from exchange-traded funds (ETFs) and market expectations of the next halving, as per data from Cointelegraph Markets.
The majority of miners’ sales before the halving occurred in January. Their total reserves ranged from 1.840 million BTC at the peak to 1.827 million BTC at the end of the month.
Historically, miners tend to sell more of their BTC reserves before the halving to maximize profits. The halving is a key aspect of Bitcoin’s deflationary mechanism, as it decreases the rate at which new BTC is generated and reduces the block reward received by miners for verifying transactions.
The halving event occurs every four years, and the next one is expected to take place around April 19, 2024. It will reduce block rewards from 6.25 BTC to 3.125 BTC. However, mining costs are expected to remain the same or even increase as miners expand their operations to ensure profitability.
In preparation for the upcoming rewards decrease, crypto miners are adjusting their strategies and seeking ways to capitalize on the situation. One example is CleanSpark, which recently announced plans for an in-house trading desk. This means that the company will manage and trade its substantial Bitcoin holdings without relying on external brokers, potentially reducing trading costs.
According to an analysis from asset manager CoinShares, CleanSpark is well-positioned to handle the revenue cut. Additionally, CoinShares believes that Riot and TeraWulf are also prepared for the halving, with the average post-halving production cost estimated to be $37,856 for crypto miners.
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