Opinion: Problems of Chinese miners are driving the price of bitcoin
The rise in the price of bitcoin can be caused by both increased demand and supply constraints. This opinion was expressed in the Singapore-based trading company QCP Capital, pointing out the difficulties that Chinese miners have recently faced when trying to liquidate their assets..
“The lack of supply has been extremely beneficial to the trend of this rally, devoid of the large declines from the sales that miners have experienced in the past,” she writes..
Since miners finance their activities with traditional currency, they constantly side with the sellers, putting pressure on the market. However, recently from China, where over 70% of the bitcoin hashrate is concentrated, there have been reports that miners are increasingly facing difficulties when trying to liquidate cryptocurrency due to the freezing of their accounts and cards..
Earlier, Chinese journalist Colin Wu conducted a survey among miners, 74% of whom confirmed that they are experiencing difficulties with paying their electricity bills. HASHR8 COO Thomas Heller also states that withdrawing bitcoins and Tether into fiat currency for Chinese miners now presents a “challenge”.
“Mining pools were selling large volumes of bitcoins in early September through exchanges, but this activity was abruptly interrupted when the last channels for withdrawing funds were affected by the arrest of the heads of major exchanges, such as Star Xu, and other OTC brokers,” writes QCP Capital.
According to the company, the sale of miners led to a decrease in the price of bitcoin from $ 12,000 to $ 10,000, but the supply of new coins decreased after blocking the withdrawal of funds from the OKEx exchange.
At the same time, financing rates for margin positions remain at near-zero levels, while significant deviations in the indicator are usually considered a sign of market overheating. According to QCP Capital, the reason for this phenomenon is also an imbalance in the spot market..
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