JP Morgan: Bitcoin miners selling their tokens could push its price even lower

Bitcoin miners selling their tokens could push down the price of the largest cryptocurrency for some time, according to JP Morgan, according to Bloomberg.

Listed miners, who account for about 20 percent of the total, already sold Bitcoin in May and June to increase liquidity, cover mining and leverage costs, say JPMorgan strategic analysts. Private miners may have sold a larger share of the mining activity to cover running costs.

“The sale of Bitcoins by the miners, in order to cover current expenses, could continue in the third quarter, if their profitability does not improve,” wrote the strategic analysts. This sale “has probably already pushed up prices in May and June, although there is a risk that this pressure will continue.”

The biggest cryptocurrency has fallen more than 50% since the beginning of the year, as the US Federal Reserve begins to raise interest rates and inflation remains high.

Problems with cryptocurrencies have been exacerbated by the collapse of the Terra / Luna ecosystem, as well as concerns about the hedge fund Three Arrows Capital.

One thing that could ease the price pressure, according to JPMorgan: a drop in production costs from a range of about $ 18,000 to $ 20,000 earlier in the year to $ 15,000 this month.

Estimates for Bitcoin mining costs can vary. The cost of production for a large mining company is about $ 8,000 per token with average electricity prices and new mining machinery, according to Arcane Crypto. However, Securitize Capital says that taking into account overhead costs for infrastructure and interest rates, the total cost for some mining companies may already be over $ 20,000.

Bitcoin is currently trading at $ 21,113.40.