Despite the impending Bitcoin halving, the five largest Bitcoin mining firms have chosen not to sell their Bitcoin holdings. According to a report by Bitwise, these firms sold a total of approximately 2,000 BTC in the first quarter of 2024, marking the lowest selling activity in two years. In comparison, they sold over 7,000 BTC in the fourth quarter of 2023.
The report arrives just days before the Bitcoin halving, which will reduce block issuance rewards from 6.25 BTC to 3.125 BTC per mined block. Coupled with the increasing Bitcoin hash rate, this reduction could potentially impact the profitability of mining firms.
Despite the potential challenges, Bitcoin miner revenue saw a significant increase of 30% quarter-over-quarter, surpassing the recent lows experienced in the fourth quarter of 2022. Bitwise reports that Bitcoin miner revenue rose above $4.5 billion.
However, while Bitcoin mining revenue may not necessarily decline in U.S. dollar terms due to the upcoming halving, historical data suggests that it typically decreases in the months following halvings. For instance, post-halving mining revenue dropped by 40% in the month after the 2020 halving and declined by over 51% after the 2016 halving.
Among the top five mining firms, Marathon Digital emerged as the leader in Bitcoin production, generating over 2,500 BTC in the first quarter of 2024 compared to over 4,000 BTC in the previous quarter. However, Marathon Digital also incurred the highest mining cost of $22,249 per BTC, while Cipher Mining had an average cost of only $8,626 per BTC during the same period. The average price of Bitcoin during the first quarter of 2024 was $53,534.
Currently, Bitcoin miners worldwide hold over 700,000 BTC, which represents 3.4% of the total Bitcoin supply. The majority of Bitcoin supply, 57% or 12 million BTC, is held by individuals.