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Bitcoin (BTC) miners play a fundamental role in securing the network and also producing new coins. Since the fourth Bitcoin halving earlier this year, BTC miners have been readjusting their operations to match the rising difficulty. Moreover, the Bitcoin block reward declined from 6.25 coins to about 3.125 units every ten minutes, thus making it difficult for the existing mining rigs to remain profitable.
The Readjustment Process of Bitcoin Miners
After the fourth Bitcoin halving in April, the mining hash rate dropped from over 643 EH/s to a low of around 561 EH/s in June. The notable hash rate drop was attributed to Bitcoin miners switching off their rigs in preparation for powering up new-generation hardware.
Since June, the Bitcoin hashrate has since recovered and recently scaled to a new all-time high of about 698 EH/s earlier this month. However, the Bitcoin hash rate has since stabilized around 573 EH/s as the mining difficulty rallied to a new all-time high of about 92.67 T on Tuesday, September 11.
Capitulation Underway
Despite the higher odds of interest rate cuts in the United States next week on Wednesday, the possibility of further Bitcoin price drop still lingers. Moreover, some experts believe next week’s economic shift could turn out as a sell-the-news event, leading to further sell-offs.
As a result, on-chain data shows that both short-term Bitcoin holders and miners have been selling recently. According to on-chain data provided by Santiment, Bitcoin miners have sold over 30k BTCs, worth over $1.7 billion, in the past three days.
However, the heightened Bitcoin sell-off from miners and short-term holders has been absorbed by whales, led by U.S. spot Bitcoin ETFs.
