Bitcoin [BTC] climbed above $65,000 during the week beginning the 12th of July. A cooler Consumer Price Index reading supported the move by easing inflation concerns.
However, BTC later retreated toward $64,000. Beneath this volatility, miners continued sending fewer coins to exchanges despite worsening financial conditions.
Why are Bitcoin miners struggling?
CryptoQuant data showed that miners faced significant pressure, based on its Miners’ Financial Health Index. The index combines mining revenue, fees, issuance, and other inputs to measure the industry’s overall financial health.
Based on its seven-day Moving Average, the index stood near 29% at press time. Readings between 10% and 30% have historically aligned with bear-market conditions.
Such conditions can pressure miners’ income and increase their need to sell reserves. However, exchange-flow data showed that selling pressure had eased.
Are miners sending less BTC?
CryptoQuant’s Miner to Exchange Flow showed that miners transferred less Bitcoin to exchanges despite their financial strain. Based on the seven-day SMA, exchange flows fell from 1,825.86 BTC on the 1st of July to 1,173.66 BTC.
This represented a decline of nearly 36%, suggesting that miners reduced their immediately available exchange supply.
However, lower exchange flows did not necessarily confirm accumulation. Miners could also have moved coins through untracked venues or held them elsewhere.
The dollar value of Bitcoin in miner wallets increased by $4.7 billion, from $71.5 billion to roughly $76.2 billion.
Much of this increase could reflect Bitcoin’s price appreciation rather than growth in miners’ BTC holdings. Bitcoin rose from $58,624 on the 1st of July to $63,999 at press time.
Why are mining stocks falling?
Publicly listed Bitcoin mining stocks lost 12% collectively over the past month, according to Artemis.
The decline highlighted the financial pressure facing mining companies, even as Bitcoin’s price recovered.
Over five days, Cipher Mining [CIFR] dropped 20.3%, while Iris Energy [IREN] fell 18.3%. TeraWulf [WULF] declined 17.3%. By contrast, Bitcoin added more than $42 billion in market capitalization during the same period.
This divergence suggested that investors remained concerned about miners’ operating costs and profitability despite BTC’s recovery.
Lower miner exchange flows could reduce one source of immediate selling pressure. However, the data did not prove that miners were accumulating Bitcoin.
For now, miners’ reluctance to transfer BTC to exchanges may support supply conditions as Bitcoin attempts to reclaim $65,000.
Final Summary
- Miner exchange flows fell nearly 36% despite worsening financial conditions across the industry.
- Mining stocks declined sharply, while lower exchange transfers may ease immediate Bitcoin selling pressure.
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