Bitcoin and Ethereum rewards are being hoarded by cryptocurrency miners.

Miners are holding crypto worth billions of dollars. Bitcoin and Ethereum miners are not selling their mining profits, according to on-chain measurements and corporate production reports. Miners' crypto holdings have risen to fresh all-time highs.

Miners Refuse to Sell Cryptocurrency

The "HODL" technique seems to be used by crypto miners. The quantity of Bitcoin owned by miners has increased significantly, according to recently published output statistics from North American mining firms. Riot Blockchain, Marathon Digital, Bitfarms, Hut8, Argo Blockchain, and HIVE are among the mining companies that have amassed over 20,000 Bitcoin worth over $1.1 billion.

On-chain statistics on Ethereum also indicates an increase in the quantity of ETH owned. Miner balances have reached 532,750 ETH, according to the behavior analytics website Santiment, the highest level since 2016. As the second-largest cryptocurrency edged higher, the value of the hoarded ETH blew through all-time highs and is fast nearing $2 billion.

Rather than selling their mining rewards to pay operational expenses and finance growth ambitions, mining companies are turning to alternative sources of cash to avoid selling their crypto. For example, Toronto-based Hut8 recently filed for a $150 million public offering, wagering that the company's crypto assets will appreciate enough to compensate for the short-term price drop caused by diluting its shares.

Other businesses have begun to use their mining profits as collateral for loans. Argo Blockchain has closed a $25 million loan with Galaxy Digital Holdings using Bitcoin as security.

For North American miners, the last few months have been a once-in-a-lifetime chance to grow. Following Chinese crackdowns on cryptocurrency mining, the Bitcoin hash rate fell, lowering the mining difficulty by 28%. As a result, businesses that mined over the summer were able to produce record quantities of Bitcoin and Ethereum.

Miners' reluctance to part with their crypto assets reflects a prevailing positive attitude in the sector. The long-term positive potential of hanging on to Bitcoin and Ethereum seems to be too big for mining firms to pass up.


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