Bitcoin Miners Should Pay Costs in Depreciating Currency — Ledn Executive

Bitcoin Miners Should Pay Costs in Depreciating Currency — Ledn Executive

As macroeconomic pressures and trade tensions continue to challenge the Bitcoin mining industry, a leading executive from digital asset lender Ledn proposes a strategic shift: miners should stop selling their Bitcoin and instead use it as collateral for fiat loans to cover operational costs.

John Glover, Chief Investment Officer at Ledn, argues that miners are in a unique position to benefit from Bitcoin's long-term value proposition, and selling mined BTC for fiat not only forfeits future upside but can also lead to avoidable tax liabilities.

"If you're mining, you're generating all this Bitcoin. You understand the thesis behind it and why it's likely to appreciate in the future. You do not want to sell any of your Bitcoin," said Glover.

Debt-Financing Bitcoin Holdings: A Smarter Alternative

Glover recommends that miners borrow in fiat currency, which continues to lose purchasing power over time, while holding onto Bitcoin — an asset with deflationary properties and strong long-term growth potential. This strategy not only enables miners to meet their short-term fiat obligations but also preserves their exposure to Bitcoin's upside.

BTC mining hashprice, a metric used to gauge miner profitability, has collapsed as ever-increasing computing resources are deployed to secure the network. Source: Hashrate Index

This debt-based approach is reminiscent of strategies employed by companies like MicroStrategy, which has repeatedly used debt and equity markets to raise capital for BTC acquisition. Such firms seek to profit from the fundamental divergence between fiat currencies and Bitcoin, viewing BTC as a superior long-term store of value.

Additionally, miners can earn passive income on their held BTC through lending services, enhancing revenue without selling the asset.

Industry Under Pressure from Trade War and Costs

Bitcoin miners are already operating under immense strain, as the sector grapples with soaring energy costs, increased hardware demands, and intense global competition. Now, protectionist trade policies introduced by U.S. President Donald Trump are adding new financial headwinds.

The administration’s sweeping trade tariffs, particularly on imported technology, are expected to raise the cost of essential mining equipment like application-specific integrated circuits (ASICs). These machines, critical to maintaining competitiveness, could become significantly more expensive, putting additional stress on miners' margins.

Miners Forced to Liquidate Holdings Amid Economic Uncertainty

In March 2025, Bitcoin mining firms collectively sold over 40% of their mined BTC supply, according to data from TheMinerMag. This marked the highest monthly BTC liquidation by miners since October 2024 and reversed a post-halving trend of increased BTC accumulation that began in April 2024.

The sell-off was largely driven by rising fears over trade tariffs, inflation, and general macroeconomic instability — factors that led many mining companies to prioritize liquidity over long-term asset retention.

A Path Forward: Borrowing Against Bitcoin

For miners navigating this uncertain landscape, Bitcoin-backed loans may offer a sustainable path forward. By borrowing in fiat, companies can maintain their Bitcoin reserves, manage operating expenses, and position themselves to benefit from BTC’s future appreciation.

As Glover emphasizes, miners are among those who understand Bitcoin’s fundamentals best. Aligning their financing strategies with that belief — rather than selling into depreciating fiat — could be the key to surviving and thriving in a volatile global economy.