The cryptocurrency industry has experienced a significant resurgence in recent months, with Bitcoin’s price setting new records in December 2020 and continuing to rise in 2021. Particularly, Bitcoin miners, who had been struggling during the bear market of the previous year, have received much-needed relief from the recent price rise to $22,000 of the cryptocurrency.
After reaching local highs of $21,012 the day before, data from Cointelegraph Markets Pro and TradingView showed that BTC/USD was hovering around $20,500 on Bitstamp. The profitability of Bit coin mining has significantly increased as a result of this price rise and the network’s hash rate, enabling miners to continue operating.
Throughout the course of 2020, a number of miners were able to increase production, with Bitcoin miner accumulation beginning to rise in December 2020. The majority of capitulation appears to have passed, though some miners were forced to sell their Bit coin reserves near the market bottom due to debt obligations.
Bit coin’s hashrate has reached levels not seen since the beginning of October 2020 as a result of the current rally’s contribution to improving miner margins. Despite this strength, miners still face challenging conditions. Since the beginning of 2021, mining difficulty has increased, which may limit future upside.
Bitcoin’s Upriser to $22,000 Helps Miners’ Profit
In the current bear market, some miners have made money, but many have had to sell most of their mined Bitcoin. “Between January and November, the public miners offloaded 51,180 bit coin, while producing 47,284 bit coin,” claims Luxor Mining analyst Jaran Mellerud.
Miners will likely face even more difficulty and expense during the upcoming 2024 Bitcoin halving event, making the current conditions even more challenging. Despite this, miners have a glimmer of hope because the previous halving event in 2019 was followed by a 300% gain for BTC the year before.
Overall, the recent price rise has provided some relief to Bitcoin miners, though conditions remain challenging. Miners can stay afloat and possibly win in the long run by limiting debt and expansion and selling mined Bitcoin while still making a profit.
