Miners sent 57K Bitcoin to exchanges in 2022; selling pressure decreasing

Hull Invest

This year has not been kind to Bitcoin miners as the February 2022 invasion of Ukraine sparked a global energy crisis and mining costs through the roof.

Furthermore, the Luna collapse in June sent the price of Bitcoin to its lowest level in two years, wiping out what little profitability miners had left.

After a harsh summer of soaring electricity prices, miners welcomed a winter hurt by the impact of FTX and even more price uncertainty.

The 2022 crisis has hit both large and small mining operations. Giant publicly traded mining companies have been hit hardest: they were so profitable in 2021 that many went into debt and embarked on expensive expansion projects.

According to CryptoSlate’s analysis, on-chain data points to an incredibly stressful year.

Miner revenue per Exahash has declined sharply since the beginning of the year. Earnings denominated in USD have seen a significant increase in volatility, creating problems for those who decide to sell their BTC holdings.

Bitcoin miner earnings per exahash
Graph showing miner revenue per Exahash (source: Glassnode)

Looking at hash ribbons further confirms this trend. This metric analyzes her 30-day moving average and his 60-day moving average of Bitcoin hashrate to determine when miners surrender. When the 30-day moving average falls below his 60-day moving average, a capitulation will begin as the price of Bitcoin is too high to be mined. Bitcoin mining returns to profitability when the trend reverses.

Since the beginning of the year, the market has seen three instances of these moving averages intersecting – in June, July and August. And now the moving averages have flipped his quadruple at the beginning of December, indicating another surrender has begun.

bitcoin hash ribbon
A chart showing the Bitcoin Hash Ribbon in 2022 (Source: Glassnode)

On-chain data clearly shows miners surrendering en masse throughout the year. However, this does not mean they sold all his BTC.

According to data analyzed by CryptoSlate, the amount of BTC sold by BTC miners has actually dropped significantly since the beginning of the year.

Looking at the number of outgoing transactions from miner wallets in 2022, we can see that selling pressure is easing. Aside from a temporary spike in overseas remittances in mid-November, the trend is steadily declining.

Remittance from Minor Wallet
Graph showing remittances from minor wallets in 2022 (Source: Glassnode)

Transfers from minor wallets to exchanges further confirm this trend.

Since the beginning of the year, miner remittances to all exchanges have decreased. Miners will send a total of about 57,000 BTC to exchanges in 2022, with 18,500 going to Binance and about 12,500 to Coinbase.

Minor remittances to exchanges
Chart showing transfers from miner wallets to exchanges in 2022 (Source: Glassnode)

A closer look at Bitcoin’s hash rate reveals that the strength of the network has not been compromised. Sales pressure from rising power prices and skyrocketing hardware costs has not impacted hash rates. In fact, despite the falling price of Bitcoin, the Bitcoin hashrate is now back at the annual high it hit in mid-November.

bitcoin price hashrate
Graph showing Bitcoin price and hashrate in 2022 (Source: Glassnode)

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