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Bitcoin miners still rising despite one of the toughest bear markets ever

The past year has not been easy for Bitcoin miners (bitcoin): In 2023, a record amount of BTC was sent to centralized exchanges to cover operational costs.

As Cointelegraph previously reported, these have been eventful months for the ecosystem. bitcoin mining. sector in the second quarter of 2023 Won A massive $184 million transaction fee – Outperformed the 2022 total thanks to the recovery in BTC price and enthusiasm for BRC-20 tokens.

Moreover Shares of major mining companies were registered Impressive earnings in 2023outperforms the market performance of BTC itself. The market capitalization of the top nine publicly traded mining companies has increased by 257% since the beginning of 2023.

However miners still have to sell most of the mined BTC to cover operating costs, the sector is trying to get out of this long bear market. In June alone, miners sent $128 million worth of BTC to exchanges, presumably to sell them and thus generate revenue.

Cointelegraph reached out to some major mining companies to analyze the latest trends in the industry.

Hut8 CEO Jaime LevertonHe said his company is trying to complete the merger with USBTC: This has so far hampered their ability to raise capital through proposals. in the market. After announcing the merger, Leverton said that Hut8’s strategy is to sell options based on the firm’s Bitcoin holdings and sell newly produced BTC to cover operating costs:

“We plan to review our treasury strategy once the merger is complete. As such, we were the last major Bitcoin miner to sell some of our production earlier this year.”

Leverton said Hut8 still has over 9,100 BTC ($271 million) and company staysBitcoin rise, because it has one of the largest BTC reserves in its own mining of any publicly traded company. In his final report Regarding production and operations, Hut8 announced that it sold 217 BTC mined in May and June for $7.9 million.

Moreover Charles Chong, Senior Manager of Business Development at Foundrycommented on the subject. Chong explained Favorable market conditions have seen miners achieve a 60-80% margin in the past. on production. Foreign capital was also plentiful, allowing them to hold the mined BTC:

“However, we are in a different era right now with very little outside capital and a margin of 15-30%. This is forcing miners to liquidate their BTC to cover their operating costs.”

Chong added that Bitcoin mining moves in cycles like miners.”they are overinvesting“In good times ASIC equipment.

It should also be emphasized that mining difficulty has recently reached all-time highs: in other words, the network has never been more robust and secure. Chong has announced that new, more efficient mining devices that can achieve higher hash rates will be available in 2023. This forced miners to replenish their fleets to continue producing BTC profitably:

“However, total grid energy use is also slowly increasing, albeit at a slower rate, indicating increased investment in grid security.”

A spokesperson for Braiins explained to Cointelegraph that continued increases in difficulty are the result of an increase in hashrate. So it’s clear industry players predict a future increase in BTC price:

“To us, this is a sign that miners are still able to run machines profitably despite the current environment and are optimistic about the future valuation of Bitcoin.”

Unfortunately, current market conditions Forced the closure of some major mining companies, including Core Scientific: the company submitted its bankruptcy plan in June 2023, but has already managed to raise substantial capital to launch the restructuring plan, which is expected to take place in September 2023.

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