Bitcoin Drops Below $61,000, 166,000 Liquidated: Middle East Conflict Escalates, Miner Profits ShrinkMarket data shows that in the past 24 hours, the number of liquidated positions across the cryptocurrency network has reached 166,000, with a total liquidation value of $558 million, marking a new high since August 5th. Bitcoin, after reaching a 2-month high of $66,500 on September 27th, has been fluctuating downward, experiencing a cumulative decline of approximately 7% in the past 3 trading days
Bitcoin Drops Below $61,000, 166,000 Liquidated: Middle East Conflict Escalates, Miner Profits Shrink
Market data shows that in the past 24 hours, the number of liquidated positions across the cryptocurrency network has reached 166,000, with a total liquidation value of $558 million, marking a new high since August 5th. Bitcoin, after reaching a 2-month high of $66,500 on September 27th, has been fluctuating downward, experiencing a cumulative decline of approximately 7% in the past 3 trading days. Since the evening of October 1st, Bitcoin has plummeted from $63,800 to a low of $60,128.1, and while the decline has narrowed somewhat as of this writing, it's still trading at $61,090.8, representing a daily drop of over 4%.
In news, on the evening of October 1st, Iran launched a missile attack against Israel. The Islamic Revolutionary Guard Corps of Iran released a statement confirming the launch of "dozens" of missiles at Israel, in response to the killings of Hania, Nasrallah, and Nileforushan by Israel. As the conflict in the Middle East escalates, risk assets are all declining. Besides Bitcoin, other tokens are also falling, with Ethereum dropping more than 6% and Dogecoin losing close to 10% on the day.
Bitcoin's continuous decline has brought an end to September's rebound, dampening investor optimism about entering the historically best-performing month for cryptocurrencies. According to statistics, since 2013, Bitcoin has only finished October in the red twice. "After a strong rally since early September, technical indicators now suggest that Bitcoin is facing headwinds," stated Brian Strodtz, head of spot trading at leading cryptocurrency brokerage FalconX. "The Stochastic RSI is in overbought territory, and a large number of Bitcoin holders on exchanges are starting to sell." Chris Newhouse, research director at Cumberland Labs, said: "After rising to the $65,000 resistance level, I've noticed a weakening in spot Bitcoin demand, and many traders are taking profits."
Since the Bitcoin halving event in April, Bitcoin miners' income has seen a significant decrease. It's known that Bitcoin's daily production was variable before the halving, but always revolved around the block reward system, averaging 6.25 Bitcoins every 10 minutes. Based on the previous block reward system, this equated to roughly 900 Bitcoins produced daily. However, after the halving event, this figure dropped to approximately 450 Bitcoins per day. Currently, Bitcoin's price is almost at the same level as before the halving (between $60,000 and $65,000 per coin), yet miners' output has been halved. Based on calculations, if miners sell Bitcoin at $60,000 per coin, the entire mining industry would lose nearly $10 billion in revenue in the year following the halving.
In their latest report on October 1st, JPMorgan analysts Reginald L. Smith and Charles Peirce wrote that gross daily mining profit in September fell 6% month-over-month, reaching "the lowest point in recent history." The report stated that despite Bitcoin's moderate price rise, daily mining revenue and gross mining profit continued to decline for the third consecutive month.
Currently, the total market capitalization of the 14 major mining companies listed in the United States exceeds $20 billion. This industry has grown exponentially with the surge in Bitcoin prices over the past few years. However, due to the halving event and increased competition from the influx of large American operators, miners' profits are shrinking. Market data shows that the stock prices of Marath Holdings and Riot Platforms, two of the largest mining companies in the US, have plummeted by 34% and 54%, respectively, this year.
Overall, Bitcoin's recent performance is being influenced by a multitude of factors, including the escalating Middle East tensions, shrinking miner profits, and technical indicators suggesting headwinds. Investors need to closely monitor market developments and exercise caution when trading.
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