Recent data shows that Bitcoin miners are sending an unprecedented amount of Bitcoin to centralized cryptocurrency exchanges, surpassing previous records. Glassnode, an on-chain analytics company, reports that miners sent an incredible $128 million to exchanges in the past week alone, representing more than 300% of their daily income.
While miners’ interactions with exchanges have been volatile in the past, the current surge is unprecedented. In the past, miners typically sent their Bitcoin profits to exchanges to convert into fiat currency to cover their costs and maximize their profits. With the Bitcoin price currently at a high not seen in months, it’s an opportune time for miners to pull back and boost their profits.
Commenting on the situation, Ki Young Ju, co-founder and CEO of CryptoQuant, suggested that the market is entering a bull market cycle. This sentiment is supported by Bitcoin’s PER (price-to-earnings ratio) of 73 based on miner turnover, indicating an attractive price to sell miners and implying a bullish market cycle.
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Bitcoin miners send an unprecedented Bitcoin flow
Interestingly, despite the significant influx of Bitcoin from Bitcoin miners to exchanges, the price of Bitcoin itself has not experienced a major impact. Currently, Bitcoin is trading slightly above $30,400, up 5.5% over the past week.
However, it is worth noting that while Bitcoin mining activity has increased as the value of the cryptocurrency has risen, miner profitability has decreased by 30% compared to the same period last year. The current profitability rate is far from the highs reached during the 2021 bull market. In addition, miners are facing challenges due to increasing hash rates and difficulties, which leads to higher operating costs and reduces the overall profitability of mining.
In summary, the latest data points to an unprecedented Bitcoin flow from miners to centralized exchanges. This trend suggests that miners are taking advantage of current market conditions to convert their earnings into fiat currency and potentially increase their profits. Despite this significant movement, the price of Bitcoin has remained relatively stable. However, it is important to keep in mind that mining profitability has declined year-over-year, mainly due to rising costs and challenges associated with mining operations.
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First published in COIN KURIER, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.
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