Forget all the current scandals (FTX, LUNA, et at) , the mother of all liquidity crisis is still on the table.

Over the past few weeks three have been too many scandals too numerous to even list here. But these scandals are just the tip of the iceberg pf chaos to come.

Miners are currently paying a 30% premium to min BTC. There are a few public mining operations that are going to have to scramble to pay expenses There will soon be tsunami of liquidity issues for many BTC miners. These miners will have to pay interest on loans, payroll, pay investors who will need/want to exit, and/or make very difficult decisions about turning off equipment and sell assets. Miners will have o dup BTC on OTC or exchanges. At best marginalized mining operations will have to turn off equipment or layoff staff. At worse these marginalized miners will face a liquidity crunch forcing them to sell both BTC and mining equipment at steep discounts. This fire sale could cause the liquidity death spiral contagion to spread to other market participants. This will then touch off a massive solvency issue for the entire sector. As the contagion spreads the spiraling market dynamics will affect the more well-funded mining operations. This will lead to both marginalized and well-funded miners to feel the burn and realize their hedging and risk management strategy didn’t account for the 50% BTC discounted rate.

We will know this is happening when the marginalized miners are ether declaring bankruptcy or shopping their operations to more capitalized participants.