Analyst Charles Edwards, founder of Capriole Investments quantitative fund and author of many insightful crypto economics models, reveals that Bitcoin (BTC) miners have not been selling so aggressively since Q4, 2015.
"Bitcoin miner bloodbath": Charles Edwards on miner-driven BTC sell-off
Mr. Edwards shared the charts of the Bitcoin (BTC) price, mining expenses (log scales) and the amount of Bitcoins (BTC) miners are offering for sale. It looks like the entire segment is going through some tough days.
It's a Bitcoin miner bloodbath.
— Charles Edwards (@caprioleio) November 21, 2022
Most aggressive miner selling in almost 7 years now.
Up 400% in just 3 weeks!
If price doesn't go up soon, we are going to see a lot of Bitcoin miners out of business. pic.twitter.com/4ePh0TIPmZ
In the past three weeks, since the first rumors of FTX/Alameda's insolvency, Bitcoin (BTC) miners increased their selling pressure by 400%. This metric spiked to levels unseen since the bottom of the 2015 cycle.
Mr. Edwards is certain that, if BTC's price fails to recover in the coming weeks, a lot of miners will be forced to stop operating due to heavy losses.
Also, this painful period signals that BTC mining cannot be considered "passive income" any longer. Miners should reconsider their strategies to avoid finding themselves underwater:
What we are seeing is not sustainable. Mine-and-hodl is not a viable strategy as a Bitcoin miner. Miners are paying the consequences of the "never selling" arrogance widespread just 6 months ago. You need to manage (trade) your Bitcoin position constantly in this market.
Earlier this month, Charles Edwards revealed that Bitcoin (BTC) looked terribly oversold based on the Energy Value Model.
Selling accelerates on rocketing hashrate: Possible reasons
Meanwhile, as covered by U.Today previously, both difficulty and hashrate, two most important metrics of Bitcoin (BTC) mining activity, set new historic highs in mid-November.
Yesterday's adjustment pushed Bitcoin (BTC) mining difficulty over 36,95 T, while the hashrate almost reached the impressive level of 300 EH/s.
Anonymous analyst @BTC_Archive, commenting on Mr. Edwards' concerns, highlighted that such an imbalance between BTC miner activity and profits should be attributed to whales' secret energy sources:
The only way I can account for the increasing hashrate when the price is dumping is for some very big players with access to extremely cheap energy entering the mining game at scale.
Today, Nov. 22, 2022, the Bitcoin (BTC) price revisited its two-year low yet again; the orange coin is now changing hands at $15,700.
Alex Dovbnya
Valeria Blokhina
