The event is expected to greatly influence the price of Bitcoin in a positive way. However, miners do not follow the plan and rather dump more BTC than ever on the market.
Bitcoin cut in half is there, but the opposite of what was expected happens
Every approximately four years, each halving of Bitcoin reduces the overall supply that miners receive to validate the network.
The reduction in the already limited supply of BTC is incorporated directly into the protocol itself.
Every bitcoin cut in half in the past has unleashed a new wave of bulls and pushed Bitcoin to a new historic record.
The theory behind this cycle is that the cost to validate each block and add it to the blockchain remains the same regardless of the amount of the BTC reward.
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Thus, the reduction by half leads to a drop in income overnight among minors. This is due to an increase in production costs achieved thanks to the less BTC received.
Once that happens, miners should stop selling Bitcoin at a loss, offsetting supply and demand. Price increases as a result.
However, metrics tell a different story. The opposite is happening, and miners are dumping up to $ 5 million more in BTC on the first day since the halving.
Interesting day. Blow my mine so many miners dive into it $ BTC store batteries to sell savings now.
– MeanHash⛏️?⛏️ (@MeanHash) May 13, 2020
Miners dive into BTC stock and dump 622 BTC more than mined
According to the data, rather than less BTC sold by miners, an additional 622 BTC of sales pressure hit the market after the halving.
That is 622 BTC more than what was actually extracted during the same day. Not only does this suggest that miners are not holding their BTC more firmly, but they are even diving into stocks.
What is not clear is which miners are currently exploiting their Bitcoin savings to sell. However, the capitulation could be in the air.
Some of the most respected researchers have warned that Bitcoin will see a crash if prices do not go up soon. The production cost of each CTB has now increased and the least efficient miners are at risk of being ousted.
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Miners who cannot generate enough income to cover their energy costs while making a profit may have to close their doors and find another business model.
If this happens, the sale of stocks will only increase, not decrease in the short term.
Once all of the remaining weak miners have been eliminated, the state of the Bitcoin network will be in good health. The decor will finally be set for the next bull race.