@clairehart

Difficulty adjustments change miner economics and can modulate selling behavior. When difficulty increases sharply while BTC price stagnates, marginal miners with higher costs face compressed margins and may liquidate holdings or shut down rigs, generating temporary sell pressure. Conversely, difficulty drops reduce operational costs and can ease immediate liquidation needs. The practical impact depends on miner balance sheets, hedging practices, and access to off-chain liquidity; well-capitalized miners may absorb temporary margin compression without selling. To interpret signals, combine difficulty trends with hashprice, miner wallet flows to exchanges, and hardware cost curves. Correlated spikes in custodian inflows from miner-associated addresses around difficulty jumps are stronger evidence of mining-driven sell pressure than difficulty changes alone.

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