Bitcoin (BTC) price is seen failing to hold above $17k and falling to the support trading level near $16,500 again. The price of BTC remains under pressure due to the risk that haunts the miners and indirectly affects the psychology of investors and traders. On-chain data reveals BTC miners are liquidating their Bitcoin holdings due to financial constraints. The effect can be easily seen through the fall in the share price of mining companies.
Crypto mining stocks listed on the NASDAQ including Marathon Digital, Core Scientific, Riot Blockchain, Hut 8 Mining, HIVE Blockchain Technologies, and Stronghold Digital Mining have fallen massively in the past 6 months. Things got worse this month, with shares of Marathon Digital, Core Scientific, and Stronghold Digital Mining plunging 46%, 20%, and 38% in a month, respectively.
Crypto miners have reported weak quarterly results and a decline in the amount of crypto assets mined. Although the price of Bitcoin has fallen this year, the hash rate of Bitcoin, which indicates mining competition, has reached a maximum.
However, the hash rate and mining difficulty started to decrease this month due to the decrease in mining activity. The mining industry is under pressure amid the continuing fall in BTC prices, rising energy costs, and debt burdens. Therefore, financial problems and falling stock prices will cause the company to eventually go bankrupt. Eventually the Bitcoin dump will be liquidated as a last resort.
Additionally, miners' BTC reserves have dropped by 13K BTC in recent months. It has now reached a 14-month low of 1,818,280.032 BTC, as per Glassnode.
On-chain data also suggests that if BTC price falls below the $16.5k support level, it could lead to a $12.8k market cap. According to CoinMarketCap, the price of Bitcoin is currently trading at $16,851.
