Bitcoin (BTC) Mining Stocks Decline as BTC Pulls Back

Bitcoin mining stocks like Riot Platforms (RIOT), Marathon Digital (MARA), and CleanSpark (CLSK) saw a retreat in the pre-market session as Bitcoin (BTC) experienced a pullback. RIOT, MARA, and CLSK each fell over 2%, while other crypto-related stocks like MicroStrategy (MSTR) and Coinbase (COIN) dropped by 1.5%.

Bitcoin Sell-Off Resumes

Crypto-linked stocks pulled back as Bitcoin resumed its downtrend on Wednesday. After rising to $63,750 on Monday, BTC is now hovering around $60,000, and it remains unclear if it will bounce back. Most importantly, Bitcoin is dangerously close to the crucial support level at $58,273, which is the 200-day Exponential Moving Average (EMA). The next support level for Bitcoin is $56,426, representing its lowest point in May.

Bitcoin Price Chart

If Bitcoin drops below these levels, it could signal that bears have prevailed, potentially pushing the price down to $50,000 or lower. This decline followed a whale depositing nearly 2,000 Bitcoins to Binance in two separate transactions. While not always the case, deposits to exchanges typically occur when holders are exiting their positions.

The whale deposited 1,023 BTC ($62.2M) to Binance again 45 minutes ago. The whale has deposited 1,723 BTC ($106M) to Binance in the past 24 hours. The price of BTC has dropped by ~3% in the past 24 hours.

This whale action coincided with the German government selling its Bitcoin holdings, transferring coins worth $52 million to exchanges on Tuesday. As a result, data shows that the volume of Bitcoin balances in exchanges has started to rise, with the volume increasing to 2.49 million on Tuesday from last month’s low of 2.47 million.

Bitcoin Balances in Exchanges

If Bitcoin’s sell-off continues, it will put Bitcoin mining companies like Marathon, CleanSpark, and Riot Platforms at risk. These companies typically have a close correlation with Bitcoin’s performance.

Bitcoin Mining Companies at Risk

This drop is occurring a few months after the halving event, which reduced the amount of Bitcoins that miners receive. To compensate, many of these companies have added more mining equipment. For instance, CleanSpark achieved a 20 EH/s hash rate, helping it mine 445 coins in June after mining 417 coins in the previous month. This was possible after acquiring five mining sites in Georgia.

Marathon Digital mined 590 coins in June, marking a 40% drop from the same month in 2023 and remaining flat from May. Conversely, Riot Platforms has focused on acquiring Bitfarms, a company that mined 189 coins in June.

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