Coinbase says miner sale of newly minted bitcoins does not add significant market pressure
Coinbase and Bitcoin
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Coinbase says miner sale of newly minted bitcoins does not add significant market pressure
A common concern during the cyclical slowdown in bitcoin mining is the extent to which miners are selling off their BTC holdings, crypto exchange Coinbase (COIN) said in a research report last week. The note added that in times of market turmoil and falling bitcoin prices, margins shrink across the board, forcing more miners to become net sellers.
Coinbase said that the financing environment for the mining industry has changed significantly since late last year, and it has become increasingly difficult to raise capital in the public markets, given the fall in prices and the resulting loss of profits.
Nevertheless, even if all newly issued bitcoins were immediately sold off the market every day, this would equate to only 900 BTC selling pressure, representing just 1%-1.5% of total daily volume, it added.The report states that a healthy bitcoin derivatives market should allow miners more choice in terms of potential hedging strategies.
Bitcoin mining, BTC holdings, Crypto exchange, Coinbase, Cryptocurrency, Bitcoin Price