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Bitcoin Miners Accumulate Despite 33% Margin Squeeze

Coin WorldThursday, Apr 17, 2025 10:39 am ET

1min read

Bitcoin miners have been capitalizing on the market volatility in April to continue accumulating Bitcoin, despite facing two consecutive months of net outflows. This strategic accumulation follows a period of heightened selling pressure, where miners were compelled to liquidate more coins than usual to cover operational expenses. The market volatility, influenced by various factors including geopolitical uncertainties, has resulted in a significant decline in Bitcoin prices, which has, in turn, affected miner profitability.

Miners, who operate large-scale operations involving specialized computers that process transactions and mint new coins, have experienced squeezed margins. Lower Bitcoin prices, reduced transaction fees, and a record-high Bitcoin network hash rate have all contributed to increased mining costs. Consequently, miner operating margins have decreased from 53% in late January to 33% in recent times. This financial strain has forced miners to sell more of their mined Bitcoin to sustain their operations, with a notable outflow of 15,000 BTC on April 7, marking the third-largest daily outflow this year.

The selling pressure has been intensified by the overall market conditions, which have been described as one of the least bullish phases for Bitcoin since November 2022. Despite these challenges, miners have been leveraging the April volatility to their advantage, continuing to stack Bitcoin. This strategy underscores their confidence in the long-term value of Bitcoin and their belief that the current market conditions present a buying opportunity.

The recent price movements of Bitcoin have been modest, with a 1% increase over the past 30 days and a nearly 9% rise over the last week after hitting a low of nearly $75,000. This volatility has created a dynamic environment where miners can strategically accumulate more Bitcoin, positioning themselves for potential future gains. The ability of miners to navigate these challenging conditions and continue stacking Bitcoin highlights their resilience and strategic acumen in the face of market uncertainties.

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