June has been a challenging month for Bitcoin and its investors, marked by significant price declines. Recent analyses suggest that Bitcoin miners played a substantial role in these drops through large-scale sell-offs.
Alarming Sell-Off Rates by Bitcoin Miners
According to the market intelligence platform IntoTheBlock, Bitcoin miners sold over 30,000 BTC (valued at approximately $2 billion), marking the fastest sell-off pace in over a year. This surge in sales followed a recent halving event, which reduced miners’ rewards from 6.25 BTC to 3.125 BTC, squeezing their profit margins.
The halving event significantly impacted miners’ revenues and profitability. Coupled with Bitcoin’s lackluster price movement since reaching a new all-time high in March, miners opted to prioritize immediate financial stability over potential future gains.
To cover operational costs, miners have been offloading substantial portions of their holdings. As a result, Bitcoin’s price plummeted from around $70,000 at the beginning of the month to below $63,000.
Insights from Analysts
Crypto analyst Willy Woo emphasized the impact of these miner sell-offs, suggesting that Bitcoin’s recovery depends on the exit of weaker miners and a subsequent recovery in hash rate. He explained that this shakeout would lead inefficient miners to bankruptcy, compelling others to upgrade their hardware.
While Bitcoin is expected to rebound impressively after this phase of miner liquidation, it faces the risk of further decline, potentially dropping below the critical $60,000 mark if the selling pressure continues.
Additional Downtrend Risks
Another factor contributing to Bitcoin’s potential downtrend is highlighted by crypto analyst Ali Martinez. He noted that around 5.45 million addresses purchased 3.03 million BTC within the $64,300 to $70,800 range. This range now forms a significant supply barrier, with the possibility of a steep correction if these holders decide to sell off their holdings to limit losses.
Bitcoinist reported that Bitcoin has fallen below the short-term holders’ realized profit level of $66,200. If Bitcoin fails to rebound soon, these investors might cut their losses or secure minimal profits, adding further downward pressure on Bitcoin’s price.
In conclusion, Bitcoin’s tumultuous June was largely driven by miner sell-offs and significant resistance levels. While a recovery is anticipated post-liquidation, Bitcoin remains vulnerable to further declines if current trends persist.
Bers continue to push down hard the Bitcoin price.