[Bitcoin Now] Mining Profitability Improves... "Should I Just Hold On?"

Average Mining Cost Falls Below Bitcoin Price
Preference for Holding... Stabilization Despite Negative Factors

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Lee Jung-yoon] The profitability of miners, which had worsened due to the sharp drop in Bitcoin prices, is improving.

According to MacroMicro, a global economic data analysis platform, since the 15th of last month, the average Bitcoin mining cost has remained lower than the Bitcoin price. The most recent data on the 2nd of this month showed the average Bitcoin mining cost at $18,383, about $4,500 lower than the Bitcoin price, which was trading in the $22,900 range at that time.

Following the Luna incident and interest rate hikes, the cryptocurrency market was hit, causing a reversal phenomenon where the average mining cost was higher than the Bitcoin price. On June 17, the average mining cost was about $10,000 higher. This phenomenon occurred roughly once every 2 to 4 days and sometimes lasted for more than a week.

However, as Bitcoin prices recently showed an upward trend, maintaining the $22,000 to $23,000 range, profitability has improved. Additionally, miners who were mining at relatively high costs have left the industry, resulting in the average mining cost recording a lower level than before. As profitability improves, miners are shifting their stance from selling Bitcoin to holding it. According to cryptocurrency data firm CryptoQuant, as of the previous day, miners’ Bitcoin holdings were 1,864,620, up from 1,858,519 at the beginning of last month. Although the increase is not large, on June 21 alone, holdings decreased by 5,100, and selling pressure was strong. However, since the 6th of last month, miners have been increasing the number of Bitcoins they hold rather than sell.

Along with improved profitability, Bitcoin is showing a stable trend despite adverse events such as hacking in the market. First, it was reported that about 8,000 wallets based on the blockchain network of Solana, a cryptocurrency ranked in the top 10 by market capitalization, were hacked. As a result, Solana’s price plummeted, and major domestic cryptocurrency exchanges suspended deposits and withdrawals. Additionally, a large-scale hack occurred on Nomad, a bridge protocol that allows cryptocurrency transfers between different blockchains. The damage is estimated at around $200 million (approximately 261.7 billion KRW).

Nevertheless, as of 11 a.m. on the same day according to the global cryptocurrency market relay site CoinMarketCap, Bitcoin recorded $23,151 (about 30.31 million KRW), up 1.38% from the previous day. The rise appears to have been driven by the Nasdaq index, which is centered on tech stocks showing synchronized movement, closing up 319.40 points (2.59%) at 12,668.16 the previous day. Despite these adverse events, the price rose, leading cryptocurrency specialized media CoinDesk to evaluate that "Bitcoin prices showed resilience despite turmoil within the industry."