When the May 11 block reward halving occurred, analysts anticipated the the event caused the amount of BTC mined to drop by half, thereby decreasing the revenues of most miners by up to 50% overnight.
However, data from Blockchain.com shows that the hashrate of Bitcoin has recovered close to pre-halving levels. The mining industry remains healthy despite the halving, which might further brighten the sentiment around Bitcoin overall.
The large mining centers based in Sichuan, China, remain largely profitable. The rainy season caused electricity rates to drop, reducing the cost of mining BTC. Consequently, miners have less incentive to sell large amounts of BTC in the near-term to cover costs. Typically, overleveraged miners are pressured to sell after halvings as the cost to mine Bitcoin spikes. This time around, the block reward halving was met with relatively low selling pressure.
Therefore, a confluence of low selling pressure from miners, favorable long-term technical structure, increasing HODLing activity, a growing number of whales and rising institutional adoption raise the probability of a newfound rally by 2021.
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