After plummeting below $60,000 yesterday, Bitcoin has bounced back up to $65,000 in a final bout of volatility before its next halving.
The Bitcoin halving is currently scheduled to take place late Friday night or early Saturday morning—depending on geographic location. When it does occur, the reward paid out to Bitcoin miners that process transactions on the network will automatically be cut in half from 6.25 to 3.125 BTC.
Although the last three halving events have famously kicked off bull runs for Bitcoin—the world’s oldest and largest cryptocurrency by market capitalization—a halving also tends to bring on some volatility. At the time of writing, the Bitcoin price is sitting at around $64,740, up 4.6% since this time yesterday.
Even more impressive is that BTC has climbed 8% from the low of $60,022 it saw Thursday afternoon, and came within a whisker of hitting $65,000 earlier today, per data from CoinGecko.
But all that volatility has been hell for Bitcoin derivatives traders. Since Thursday, $293 million worth of futures positions have been liquidated, according to Coinglass. That’s not counting the $255 million that got liquidiated when BTC took a plunge on Wednesday or the more than $1.5 billion that were liquidated on Friday and Saturday last week.
“It took nearly two months of disgusting price action,” said pseudonymous trader Jelle on Twitter, “but the system has been cleansed of froth and greed. Ready for the next leg high.”
Investors who managed to HODL their bags through the ups and downs are sitting on pretty sizable gains, Cryptoquant founder and CEO Ki Young Ju pointed out on Twitter. The biggest beneficiaries are—no surprise—old whales who filled their BTC bags years ago. But large- and small-scale Bitcoin miners are also sitting on hefty gains—81% and 131%, respectively.
Besides revenue that’s soon to be cut in half, Bitcoin miners are now facing competition for the hardware and power they need to operate. The AI boom has created a huge demand for the very same resources that miners need.
“Bitcoin ASIC chips have had to compete with strong AI chips demand this cycle,” a Bernstein analyst said in a recent report, “and thus manufacturers have been keen on bulk contracts/purchase options with miners who are flush with cash” from capital raises.