One of the largest Bitcoin (BTC) mining companies in North America, Riot Platforms, sold a huge portion of its BTC holdings last month.
According to the latest data by crypto analytics platform Arkham Intelligence, the mining company sold 475 BTC for about $38.8 million to a leading institutional crypto custodian, NYDIG.Sou
The analytics platform also showed that Riot transferred a separate $6.7 million in BTC to this same custodian. These transfers have raised questions among the crypto community over whether Riot intends to sell more of its BTC holdings.
Why is Riot Platforms selling Bitcoin?
As one of the largest publicly traded Bitcoin miners, it is not uncommon for Riot to hold massive amounts of the leading digital currency as part of its treasury strategy. Formerly known as Riot Blockchain, Riot Platforms is a leading player in the BTC mining industry with many operational facilities in the United States.
The Arkham Intelligence data shows that the company's portfolio includes about 6,011 BTC worth nearly $626 million based on BTC's current value of $94,733. Usually, Bitcoin mining companies like Riot sell their BTC holdings for various reasons.
Such reasons include expansion plans, fulfilling operational expenses, equipment upgrades, and electricity costs. Based on the amount of BTC sold by Riot, analysts suggest that the miner's reasons for the sale could be to strengthen its cash position and fund its operations.
Institutional Bitcoin boom vs. miner sell-off
Riot Platforms’ Bitcoin sales coincide with a period in which institutional interest in Bitcoin continues to grow, with spot BTC ETFs in the U.S. recording a third successive week of inflows, according to a CoinShares report.
The report revealed that total inflows into these ETFs this past week were $2 billion, while total inflows over the last three weeks reached $5.5 billion.
Even though the miner's sell-off isn't large enough to cause any significant changes in BTC’s price, some traders have expressed their concerns.
They worry that if the miner continues to sell, institutional holders' confidence in the crypto asset could start to dwindle. Riot Platforms' stock (RIOT), which is listed on the NASDAQ exchange, currently trades at $7.90, down almost 6% in the last 24 hours, according to Google Finance data.
Vladislav Sopov