More selling pressure in the cryptocurrency market is likely on the horizon as Bitcoin miners with large holdings of the digital asset face a sharp drop in revenue, according to researcher Kaiko.
The main source of revenue for crypto-mining companies such as Marathon Digital, Riot Platforms and Cipher Mining was dramatically reduced by a Bitcoin code update in late April. Called the halving, such updates are preprogrammed in the blockchain to slash mining subsidy, a fixed amount of Bitcoin rewarded to miners for validating transaction data, by half every four years. The most recent halving, the fourth since 2012, cut the daily production from 900 tokens to 450, resulting in about $10 billion revenue loss a year based on the price at that time.
