According to a market report from Bitfinex, Bitcoin mining companies are employing derisking strategies by selling off BTC to exchanges. The report highlights a recent surge in miners selling large volumes of BTC to exchanges, resulting in an increase in the value of shares in Bitcoin mining companies as institutional interest in BTC grows in 2023.
Poolin is noted as the mining pool responsible for the highest amount of BTC sold to the market in recent weeks. The report also mentions that the Bitcoin mining difficulty recently reached an all-time high, which is seen as a positive indicator of “robustness and miner confidence.” While miners historically transfer BTC to exchanges using derivatives as a hedge for large spot positions, the report labels the current high volumes as uncharacteristic and suggests it may represent new miner behavior.
Bitfinex cites data from Glassnode, indicating that Poolin has been a major player in this activity, offloading BTC to Binance. The reasons behind this recent mining behavior could include hedging activities in the derivatives market, executing over-the-counter orders, or transferring funds through exchanges for various reasons.
The increase in mining difficulty reflects the addition of new mining power to the Bitcoin network, suggesting increased network health and confidence in mining profitability due to higher BTC prices or improved hardware.
The report also notes that on-chain Bitcoin movements show a transfer of supply from long-term holders to short-term holders. This behavior is typical during bull market conditions, where new traders seek quick profits while long-term holders capitalize on increased prices.
To further understand the reasons behind the increased outflow of Bitcoin from miners over the past month, Cointelegraph has reached out to several mining companies and pools for clarification. As of the end of June 2023, miners had sent over $128 million in revenue to exchanges.
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