Bitcoin, which has been bearish since its $31,000 ATH in April, has been consolidating in a tight range for a long time.
Analysts at crypto services provider Matrixport, which covers the price of BTC and the plight of miners, noted that miners have been struggling to liquidate new BTC they mined as the margin in Bitcoin price has narrowed in recent weeks.
Stating that the BTC price is experiencing selling pressure at the level of $ 28,000, analysts wrote that miners may be responsible for this.
“We suspect that Bitcoin miners have been forced to liquidate the new BTC they have produced due to the drop in profit margins in recent weeks.
Because of the continuous increase in Bitcoin mining difficulty, mining has become very competitive and often unprofitable. Mining difficulty, a measure of how easily miners can discover a new bitcoin block, has recently reached an all-time high.
In this context, most Bitcoins produced before 2022 seem unprofitable, given the current BTC mining cost and potential revenue prospects on the miners front.
At this point, this means that miners are forced to sell at the current level instead of holding their stock until BTC prices rise.
There is now a significant upward convexity for miners as profitability could quadruple if Bitcoin prices increase by 10% plus.”
*Not investment advice.