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Miners sold 100% of the Bitcoin mined in May

Miners sold 100% of the Bitcoin mined in May

The cost of producing the first cryptocurrency has exceeded profits, forcing mining companies to dispose of their digital asset stocks.

According to Arcane Research, public miners sold 100 percent of the coins they produced in May, compared to the first four months of 2022 when miners sold between 20% and 40% of bitcoins mined. Analysts point to the sharp drop in profitability of mining as the reason for such a significant increase in sales.

Researchers claim that public mining companies only produce about 20% of bitcoin's hash rate, but their behavior strongly reflects what private miners do. Analysts predict that deteriorating market conditions in June will force miners to liquidate even more holdings.

Arcane reports that rising hash rate and declining bitcoin prices have reduced mining profitability to 2020 levels: returns on the energy efficient Antminer S19 hardware model are down by 80% compared to their November 2021 peak. Antminer S9, an old generation machine, shows negative returns today.

The report says that industrial miners own 46,000 BTC. At the same time, the researchers suggest that forced liquidation of a significant share of these holdings could contribute to a further decline in the Bitcoin price.

Canadian cryptocurrency mining company Bitfarms sold a total of 3,000 bitcoins for about $62 million in the last week. The revenue was used to pay off loans and pay for new equipment.

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