Bitcoin mining remains a high-cost and competitive activity where profitability often depends on careful financial planning.
According to John Glover, Chief Investment Officer at Ledn, miners could improve their position by holding onto their Bitcoin and using weaker local currencies to pay for operational expenses.
With rising hardware prices, energy costs, and new tariffs creating additional challenges, this strategy may offer miners a more stable path forward.
Holding Bitcoin and Borrowing Cash to Reduce Pressure
Bitcoin miners provide an essential service by confirming transactions and securing the network. They are rewarded with new Bitcoin and fees from users, but the process requires expensive hardware and significant electricity.
As the network grows, so do the costs of participating in it. Instead of selling their Bitcoin to cover these costs, John Glover recommends a different approach.
He suggests that miners should treat Bitcoin as a long-term asset and use it as collateral to borrow cash. This would allow them to cover operating costs without losing their BTC exposure. “If you’re a miner, you’re making Bitcoin every day.
You already believe in Bitcoin’s long-term growth, so why sell it?” he told Cointelegraph. Companies like MicroStrategy follow a similar model by borrowing money or issuing shares to buy more Bitcoin.
Keeping Bitcoin instead of selling it has additional advantages. In some regions, holding BTC delays tax obligations until it is sold.
Miners can also lend their Bitcoin to generate returns, depending on the platform and risk level involved. This further supports the idea of treating Bitcoin as a productive asset rather than just a means to pay bills.
The strategy becomes even more practical in countries with high inflation. In such cases, miners are better off spending local currency, which is losing value quickly, rather than converting their Bitcoin.
This method effectively protects their BTC from being spent at a low value while using weaker money for daily expenses.
This shift in strategy is already taking hold. Miners in inflation-affected economies are locking in power contracts in local currency, negotiating better terms, and using national currencies to pay wages and rent.
Meanwhile, they keep their mined Bitcoin untouched, aiming to benefit from future appreciation. This way, miners not only preserve value but reduce the pressure of having to sell BTC every time they need to cover a cost.
Rising Costs and Economic Risks Demand Smarter Financial Decisions
Although this approach offers several advantages, mining is still a challenging business. The industry continues to face growing competition and rising costs.
Advanced ASIC machines are now necessary to compete effectively, and they come at a high price. If miners cannot afford regular upgrades, they risk falling behind.
Adding to the difficulty, President Trump’s proposed tariffs could increase the cost of importing mining equipment.
Most ASIC miners are manufactured abroad, especially in China. If these machines become significantly more expensive due to tariffs, the profit margin for many miners may be reduced to unsustainable levels. In such a case, only those with strong capital management may be able to continue operating.
As a response, miners are starting to plan more carefully. Some are securing lower-cost electricity in areas with abundant supply, while others are relocating to countries with better regulatory support. Others are choosing to finance their operations using debt instead of selling Bitcoin, to avoid missing out on long-term gains.
These miners understand that if Bitcoin increases in value, selling it now could mean giving up far more in the future.
Glover’s guidance is also helping miners think more like long-term investors. Instead of reacting to short-term market fluctuations, they are adopting models where Bitcoin is seen as a reserve asset.
Spending cash instead of BTC reduces emotional decision-making and protects against being forced to sell during price drops.
The shift could also have broader effects on the Bitcoin market. If more miners begin holding rather than selling, this could reduce the amount of Bitcoin flowing into exchanges. Over time, such a change could influence liquidity and price behaviour.
Although the full impact is difficult to measure, fewer miners selling Bitcoin might result in lower supply pressure, potentially supporting price stability.
This strategy does not eliminate the challenges of mining, but it does offer a practical way to manage them.
With proper planning and discipline, miners can protect their position in the market while continuing to contribute to the Bitcoin network. By spending weaker local currencies and holding Bitcoin, miners may be able to weather difficult conditions and remain competitive.
Conclusion
John Glover’s recommendation is simple but effective. Miners should avoid selling their Bitcoin unless absolutely necessary and instead use it as collateral to access cash. This allows them to pay expenses using weaker local currencies, protect their BTC reserves, and prepare for long-term growth.
In a high-cost and uncertain mining environment, financial discipline and strategic planning may be what separates those who stay from those who are forced to leave.
Editor: Lydicius