The shrimps of the crypto world have joined the whales in a glorious last fight to banish bitcoin’s dark winter.
These two contrasting groups are both HODLers – investors in bitcoin as a long-term proposition who refuse to sell their holdings – and they are determined to fend off the bears, despite their portfolios deep in the red.
Shrimps, i.e. investors who hold less than one bitcoin, are collectively adding to their balance at the rate of 60,460 bitcoins per month, the most aggressive rate in history, according to a company analysis Glassnode data.
PAIN OF MINORS
Another class of strong cryptocurrency advocates – bitcoin miners – are coming under increasing pressure as they face the twin threats of falling prices and high electricity costs. The cost of mining bitcoin is higher than the price of the digital asset for some miners, said Citi analyst Joseph Ayoub. See also: Ethereum Price Prediction: Here’s Why ETH Bears Predict a 15% Drop.
The unfavorable environment for many of these miners, who took out loans against their mining systems, forced them to dip into their reserve. read more
Core Scientific (CORZ.O) sold 7,202 bitcoins last month to pay for its mining rigs and fund its operations, bringing its total holdings down to 1,959 bitcoins.
While Marathon Digital Holdings (MARA.O) said it has not sold any bitcoin since October 2020, the company has indicated that it may sell some of its monthly production to cover its costs.
The Valkyrie bitcoin miners ETF (WGMI.O) crashed 65% in the last quarter, outpacing bitcoin’s 56% drop.
The lessons from the crypto winter of 2018 were that the miners who survived were the ones who kept producing even though they were underwater. That approach is unlikely to work this time around, however, said Chris Bae, CEO of Enhanced Digital Group, which designs hedging strategies for crypto miners.
For the bosses of societys mining, adds Bae, the focus is now on the “need to think about the next crypto winter and have that game plan before it happens rather than during it.” »
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