Bitcoin Miners Hold Reserves Despite 34% Revenue Drop

Bitcoin miners are currently facing one of the most challenging periods in recent history, with revenues plummeting to their lowest levels in over a year. Despite this financial strain, miners have shown remarkable resilience, avoiding panic selling and instead choosing to hold onto their Bitcoin reserves.

On June 22, daily miner revenues hit a two-month low of $34 million, driven by lower transaction fees and a significant drop in Bitcoin's price. This figure marks the lowest revenue since April 20, highlighting the severe financial pressure miners are under. The Bitcoin network's hashrate, a measure of the computational power used to mine Bitcoin, has also declined by 3.5% since June 16, the largest drop since July 2024. This decline in hashrate is likely a response to the reduced profitability of mining operations.

Despite the financial challenges, miners have not resorted to selling their Bitcoin holdings en masse. Bitcoin transfers from miners to crypto exchanges have decreased from a daily peak of 23,000 BTC in February to about 6,000 BTC currently. This reduction in outflows suggests that miners are holding onto their Bitcoin, possibly due to the 48% Net Unrealized Profit/Loss operating margins they are still enjoying.

Large miners, in particular, have been increasing their reserves. According to CryptoQuant, miner addresses holding between 100 BTC and 1,000 BTC have expanded their collective holdings from 61,000 BTC on March 31 to 65,000 BTC currently. This is the highest level since November 2024, when reserves fell below 71,000 BTC after Bitcoin rallied past $100,000 for the first time. The increase in reserves indicates that miners are not under significant selling pressure at current price levels.

Furthermore, miners from the Satoshi era, who typically sell during strong rallies, have only sold 150 BTC so far this year, compared to roughly 10,000 BTC last year. This restraint in selling suggests that Bitcoin still has room for growth, as these miners are not signaling a market top by offloading their holdings.

In summary, while Bitcoin miners are experiencing one of the worst payout periods in a year, they have chosen to hold onto their Bitcoin reserves rather than sell. This behavior indicates that miners are confident in the long-term prospects of Bitcoin and are not under immediate financial distress. The increase in reserves and the restraint in selling by Satoshi-era miners further support the notion that Bitcoin still has potential for growth.