Over the past week, the volume of sales of the first cryptocurrency by miners increased by 11%. This may indicate the "extinction" of small representatives of the mining industry. Is this the case and will it affect the price of the main digital coin
Analyst of the Bitcoinist portal Yashu GOLA said that the capitulation of miners among small representatives of the industry has begun. This conclusion was made by referring to the data of the ByteTree service. According to them, over the past week, miners sold 11% more bitcoins than they extracted. During this period, 5888 BTC was received and 6561 BTC was realized.
Miners are forced to sell cryptocurrency reserves to stay "afloat", GOLA explained. According to him, halving, which took place in the bitcoin network on may 11, made its production unprofitable for small market participants. In this regard, they are forced to get rid of the loot to cover transaction costs.
The analyst suggested that this could negatively affect the price of bitcoin. If the exchange rate of the coin does not overcome the resistance of $10,000, it can probably trigger a new wave of decline. It will worsen, as it may cause miners to panic and sell their mined reserves.
Has the capitulation of the miners really begun?
Dmitry Shuvaev, BitCluster development Director, confirmed that the current situation is similar to the capitulation of the miners. Users disable devices that do not generate revenue from using them. As a result, in 3 days there will be a recalculation of the complexity of bitcoin mining, it will probably grow by 7-8%.
"As of today, the S9 miner gives -0.43$. People turn off devices that are not profitable for them. Since the S9 is one of the most common devices, the mass shutdown can be called a kind of capitulation," Shuvaev said.
He added that further developments depend on the value of bitcoin. If it will soon be in the region of $9500-10 000, then in two weeks there will be an even greater drop in the complexity of production. If the exchange rate of the coin reaches the level of $12 000-15 000, then the miners will again begin to accumulate coins and sell less of the extracted.
Another opinion was voiced by Viktor Pershikov, a leading analyst at 8848 Invest. According to him, the increased volume of BTC sales does not indicate the capitulation of the miners. This happens regularly, for example, the last time this situation was observed in February. Then the volume of bitcoins sold on exchanges also increased, and this put pressure on the exchange rate of the coin.
"Of course, retail mining is gradually dying out. However, current indicators of complexity and the level of hashrate indicate that the capitulation of the miners is far away: after the collapse of the network's power in early and mid-may, the hashrate is growing again. Of course, this can only indicate the distribution of network resources against the background of disconnecting farms with old equipment, but there are no danger signals that would lead the sphere to surrender, " Pershikov is sure.
From his point of view, the growth in BTC sales indicates the desire of industry participants to free up resources for the purchase of new equipment models. Another reason is the need to cover costs that have grown significantly in the face of halving and the consequences of economic problems caused by the coronavirus pandemic. In addition, the current price of BTC is favorable for its sale for USDT, as well as for exchange for altcoins, which demonstrate high investment attractiveness.
Bitfury Russia's chief operating officer Ivan Maslov also questioned the large-scale capitulation of the miners. Over the past week, the bitcoin exchange rate has increased by more than $1000. This could push the miners to fix part of the profit in case of a negative development of the situation.
"I think it is impossible to draw a conclusion about the capitulation of the miners from these data. The current price is considered attractive in order to fix the profit. Profit-taking in this case is more than justified. This is especially true after halving, because the risks, in case of a negative development of the situation, have significantly increased, " Maslov admitted.
Is the capitulation of miners dangerous for the bitcoin exchange rate?
The bitcoin exchange rate after the March fall to $3800 only once rose above $10,000, it happened on may 7. However, the price of the coin failed to gain a foothold above this level and within a few days fell to $8,100. Then the cost of the first cryptocurrency tried several times unsuccessfully to overcome this threshold, which stopped at the current point at $9500.
Yashu GOLA suggested that the sale of such a number of BTC by miners may negatively affect the value of the coin. In mid may a similar idea was voiced by the Manager of The blockchain Opportunity Fund and CEO of Blockware Solutions Matt d’Souza. However, the Writer did not agree with this. He is sure that the influence of miners prevents the growth of the price of bitcoin above $10,000, but it is unlikely to lead to a second decline.
"I believe that the growth in BTC sales puts pressure on BTC, but it is unlikely to lead to a new collapse. For this reason, bitcoin can not overcome the $10,000 level in any way. However, the fundamental indicators of the coin are strong, and the temporary Delta between the mined and sold coins is a completely healthy situation, within which I do not see increased risks for the cryptocurrency mining sector," Pershikov is sure.
A similar position is held by the head of the data center Six Nines Sergey Troshin. In his opinion, the supply of bitcoins from the miners is limited, and it will be enough to support the operation of unprofitable equipment for no more than six months. Then, when the volume of coins produced runs out, the miners will go bankrupt.
Troshin clarified that there may be a slight decline in the price of the main digital asset in the short term. However, over the course of the year, the coin is likely to become more expensive. The main obstacle to this may be the appearance of a more attractive project from the point of view of investment, for example, the release of Ethereum 2.0.
Nothing to worry about yet
Most experts agreed that it is too early to talk about a large-scale capitulation of the miners. The fact that they sold more bitcoins than they extracted is most likely caused by the increase in the price of the asset. Market participants decided to fix the profit, as the consequences of halving are not yet fully understood. Or the funds were needed to buy new equipment. For example, today, on June 1, Bitmain announced the launch of the new Antminer T19.
Even if the capitulation of the miners still began, investors do not need to worry about this, experts believe. The miners have limited reserves of coins, and their sale will not have a big impact on the BTC exchange rate.