- Even after halving, other cryptos with comparable mechanics have not shown price gain.
- According to the report, miners have been selling coins and raising funds in Q4 of 2023.
In about two months, in the middle of April 2024, Bitcoin will see a significant update that will halve the reward given to miners for successfully completing a block. The occurrence, which is often referred to as a “halving,” is generally seen as positive for Bitcoin’s value because of the strong price hikes that followed previous halvings.
Grayscale experts, meanwhile, caution that stock and flow analysis isn’t the only possible explanation for such price spikes. Even after halving, Litecoin and other cryptocurrencies with comparable mechanics have failed to show sustained price gain.
Tough Times for Miners
Moreover, according to the analysts, there are other variables outside scarcity that affect prices. They mentioned wider macroeconomic circumstances as one of those causes. It is not assured that prices would rise after a halving occurrence, according to the experts’ analysis. The bulk of Bitcoin miners’ income comes from block rewards, thus this will be a problem for them.
As the Bitcoin network’s mining difficulty continues to rise from its all-time high last year while block rewards continue to fall, miners may find themselves in a “tense position.” According to the report, miners have been selling coins and raising funds in the fourth quarter of 2023 to prepare for the approaching change.
On the bright side, miners have found a way to make a tidy sum from Ordinals-related transactions on the Bitcoin chain. To date, they have received over $200 million in Ordinals-related transaction fees, and they currently generate around 20% of their revenue from these types of transactions.
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