Bitcoin Miners Sells BTC Struggle Amid Price Drop and Rising Difficulty

Bitcoin Miners Sell BTC Struggle Amid Price Drop and Rising Difficulty

Bitcoin miners are facing challenges as the price of Bitcoin drops and mining difficulty increases. The latest data from CryptoQuant shows that Bitcoin outflows from miners have peaked, reaching 19,000 BTC per day earlier this month, the highest level since March 2024.

The halving event in April significantly reduced mining rewards, making it harder to mine coins profitably. When Bitcoin’s price fell below $50,000 on August 5, miners are selling more to cover the increased costs. CryptoQuant reported that miners’ average operating profit has fallen to 25%, a level not seen since January 2024.

Despite cash inflows from Bitcoin ETFs, the digital asset’s price has struggled since its March peak of nearly $74,000. The increasing difficulty of mining Bitcoin, currently trading at $61,000, is a major factor. The difficulty has reached a record high, requiring more processing power and energy.

Bitcoin mining typically uses large warehouses of powerful computers. Miners receive Bitcoin as a reward, but the halving event halves these rewards, making it harder to cover costs at lower prices. However, there could be a silver lining. CryptoQuant suggests that miner capitulation often occurs near local price lows during bull markets, indicating a possible recovery ahead.