Bitcoin Miners Urged to Hold BTC and Use as Loan Collateral Amid Rising Pressures

Twitter LinkedIn E-Mail
04.05.2025 134 times read 5 Comments Read out

Bitcoin Miners Advised to Hold BTC Amid Industry Pressures

John Glover, Chief Investment Officer at the Bitcoin lending firm Ledn, has recommended that Bitcoin mining companies should retain their mined BTC rather than selling it. According to Glover, miners can use their Bitcoin as collateral for fiat loans to cover operational expenses, instead of liquidating their holdings and missing out on potential future gains. He emphasized that holding onto BTC offers several advantages, including the possibility of price appreciation, tax deferral, and the opportunity to generate additional income by lending out BTC held in company treasuries.

Glover compared this credit-based approach to strategies employed by companies like Strategy, which issue both debt and equity to finance Bitcoin acquisitions. These companies aim to benefit from the differing principles underlying BTC and traditional fiat currencies, in which corporate values are denominated. He argued that Bitcoin-backed loans could serve as a crucial lifeline for miners operating in an increasingly competitive sector, which is under pressure due to ongoing trade tensions and macroeconomic uncertainty, particularly those triggered by the protectionist trade policies of the Trump administration.

The Bitcoin mining industry is characterized by intense competition and high capital costs, which continue to rise as more powerful computing resources are required to mine blocks and secure the network. The broad tariffs imposed by US President Trump have further impacted this already competitive sector, raising concerns that import duties could push the cost of mining hardware, such as application-specific integrated circuits (ASICs), to unsustainable levels.

Amid heightened macroeconomic uncertainty and fears that ongoing trade tensions could lead to widespread price increases, mining companies collectively sold over 40% of their BTC output in March 2025. According to TheMinerMag, this 40% sell-off marked a reversal of the trend that began after the April 2024 halving and represented the highest monthly BTC liquidation by miners since October 2024.

Key Data Value
BTC sold by miners (March 2025) Over 40% of output
Highest monthly BTC liquidation since October 2024
Halving event April 2024
  • Miners are encouraged to use BTC as collateral for fiat loans rather than selling.
  • Holding BTC can provide benefits such as price appreciation, tax deferral, and additional income through lending.
  • Trade tensions and tariffs have increased operational costs for miners, especially for hardware imports.
  • March 2025 saw a significant sell-off, with over 40% of mined BTC liquidated by miners.
"Holding onto BTC offers several advantages, including price appreciation, tax deferral, and the opportunity to generate additional income by lending out BTC held in company treasuries." – John Glover, Ledn

Summary Box:

  • Industry expert John Glover advises miners to retain BTC and leverage it for loans.
  • March 2025 recorded the highest miner BTC sell-off since October 2024, with over 40% of output sold.
  • Trade policies and rising hardware costs continue to challenge the mining sector.
  • Source: Cointelegraph

Sources:

Your opinion on this article

Please enter a valid email address.
Please enter a comment.
IDK y peepel keep saying the miners will just HOLD forever wen realy most just panic sell an the halving not even mean they get more coins so how do they even pay for more asics with no cashflow?
Wait so I dont get why no one talk about the tx defer John is sayin about, doesnt make any sense cos if miners just hold btcs for longez time, aint they gona pay more tx later or smethin? Plus why would bank want btc as loan thing, when they cant realy use it if price go down. thers probly bigger risks nobody is saying bout but maybe it work for big companys idk.
One thing nobody seems to mention is the risk for miners if BTC price actually drops further while they take out loans against their holdings. If the price tanks, they could end up getting liquidated and lose both their BTC and the borrowed cash, which would be worse than just selling some coins in the first place. So it's not all roses holding and borrowing, especially in this crazy market.
No one ever talks about how all these tariffs don't just make miners want to sell their BTC, but actually force some of the smaller players out because hardware upgrades just get too expensive with those import taxes.
Good point about trade tariffs, I feel like not enough people talk about how much import duties actually hurt miners, especially smaller ones. It's not just cashflow issues, it's the rising cost of gear thanks to those extra fees. That stuff adds up fast and I get why some miners would rather just sell now than risk even higher costs later. Loans might help some, but it's not a silver bullet for everyone.
Counter