Bitcoin mining market has never been this competitive.

With $66,500, the hash price has hit a historic low.

With $66,500, the hash price hit a historic low. The bitcoin mining market has never been this competitive. Is another sell-off looming?

Despite the short-term recovery in the Bitcoin market, digital gold is still about 70 percent below its all-time high of $69,000. Still, BTC bulls managed to reclaim the path to $20,000 followed by a small uptick. The largest cryptocurrency is currently trading at $20,561 — more than 7 percent above the previous day.

Despite all the market optimism, there’s little reason in the near term to expect a durable trend reversal. On the contrary: given the current situation in the mining market, market analysts expect ongoing stress rather than calm days ahead.

Difficulty to the moon

A toxic combination of rising energy prices and increasing hurdles is pushing mining companies to sell more of their coins, putting pressure on the market again.

The miners’ income per exahash, also known as the hash price, has fallen to a historic low of $66,500. In other words, mining has never been this unprofitable.

Core Scientific, a mining company based in Austin, Texas, even sold more coins in July than it mined. In other words, even publicly traded miners are selling their coins.

But a stock listing is in itself a tough business. Sometimes the shares of big mining companies perform so poorly on U.S. exchanges that they face delisting. On October 16, The Block reported that mining company Digihost ($DGHI) on Nasdaq faces delisting. If the company fails to keep its share price above $1 for 10 consecutive days within 180 days, the stock will no longer be tradable.

On the other hand, management of the company likely has only limited influence on the stock price. Mining stocks move hand in hand with the Bitcoin price, after all. And where this heads in the mid-term depends on the path the global economy takes.

Weak dollar, strong Bitcoin

Investors will be watching Frankfurt tomorrow, Thursday, October 27, as the European Central Bank (ECB) unveils its near-term rate policy. Market experts anticipate a 0.75 percentage-point hike.

Market analyst Stefan Lübeck sees this as a positive sign for BTC values:

If monetary authorities raise the base rate by at least 75 basis points, the euro-dollar exchange rate should strengthen in the first reaction. The resulting consolidation of the US dollar index (DXY) could have a stabilizing effect on equity and crypto prices, similar to the BOJ move last Friday.

Stefan Lübeck, market analyst

This also makes sense. With BTC currently at -0.51, it’s tightly linked to the U.S. dollar. In other words, a weaker dollar with a stronger euro would be good for Bitcoin.