Bitcoin Bearish Signal: Miners Sell At 3rd Largest Scale Ever

Keshav Verma

1 year ago

3 mins read

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On-chain data shows that Bitcoin miners may have been selling at a historical rate recently, something that could be bearish for the asset’s price.

Bitcoin Miner Inflow To Exchanges Has Registered A Spike Recently

According to data from the on-chain analytics firm Glassnode, miner exchange inflows hit a peak value of $70 million recently. The “miner inflow to exchanges” is an indicator that measures the total amount of Bitcoin that miners are transferring to the wallets of all centralized exchanges.

When the value of this metric is high, it means the miners are sending a large number of coins to these platforms currently. Generally, these chain validators deposit their BTC to exchanges for selling-related purposes, so this kind of trend can have a bearish effect on the value of the cryptocurrency.

On the other hand, low values suggest the selling pressure coming from the miners may be low right now, as this cohort isn’t depositing any significant amounts to exchanges at the moment.

Now, here is a chart that shows the trend in the Bitcoin miner inflow to exchanges over the last few years:

The value of the metric seems to have been quite high in recent days | Source: Glassnode on Twitter

As displayed in the above graph, the Bitcoin miner inflow to exchanges has observed a spike in its value recently. This suggests that miners have been sending rather large amounts to these platforms during the past couple of weeks.

These high values of the indicator have come as the cryptocurrency has been gradually heading downwards. This may imply that the recent market environment has made some of the miners panic sell their holdings.

Since these inflows have become elevated, the asset’s value has only extended its decline further, as it has now dropped below the $26,000 level. This recent decline in the price may be fueled in part by the dumping being done by this cohort.

From the chart, it’s visible that the peak of these inflows observed on 3rd June saw the indicator reach a value of around $70.8 million. This is a historically extraordinary level for the metric as only two trading days in the entire lifetime of the coin have seen the miners depositing at a larger scale.

Both of the instances where miners sent larger amounts to these platforms took place way back during early 2021, when the bull market was in full flow. The peak inflow spike back then (that is, the largest value the metric has ever recorded) measured to about $101 million, implying that the current surge is about $30.2 million away from it.

Naturally, Bitcoin miners selling at such a high rate recently can be bad news for the market. It now remains to be seen whether these chain validators continue to sell more in the near future, or if they are done with their dumping spree for now.

BTC Price

At the time of writing, Bitcoin is trading around $25,900, down 3% in the last week.

BTC looks to have declined in the past few days | Source: BTCUSD on TradingView

Featured image from Brian Wangenheim on Unsplash.com, charts from TradingView.com, Glassnode.com

Keshav Verma

Keshav is currently a senior writer at NewsBTC and has been attached to the website since June 14, 2021.

Keshav has been writing for many years, first as a hobbyist and later as a freelancer. He has experience working in a variety of niches, even fiction at one point, but the cryptocurrency industry has been the longest he has been attached to.

In terms of official educational qualifications, Keshav holds a bachelor’s degree in Physics from one of the premier institutes of India, the University of Delhi (DU). He started the degree with an aim of eventually making a career in Physics, but the onset of COVID led to a shift in plans. The virus meant that the college classes had to be delivered in the online-mode and with it came free time for him to explore other passions.

Initially only seeking to make some beer money, Keshav unexpectedly landed clients offering real projects, after which there was no looking back. Writing was something he had always enjoyed and to be able to do it for a living was like a dream come true.

Keshav completed his Physics degree in 2022 and has been focusing on his writing career since, but that doesn’t mean his passion for Physics has ended. He eventually plans to re-enter university to obtain a masters degree in the same field, but perhaps only to satiate his own interest rather than for using it as a means to find employment..

Keshav has found blockchain and its concepts fascinating ever since he started going down the rabbit-hole back in 2020. On-chain analysis in particular has been something he likes to research more about, which is why his NewsBTC pieces tend to involve it in some form.

Being of the science background, Keshav likes if concepts are clear and consistent, so he generally explains the indicators he talks about in a bit of detail so that the readers can perhaps come out having understood and learnt something new.

As for hobbies, Keshav is super into football, anime, and videogames. He enjoys football not only as a watcher, but also as a player. For games, Keshav generally tends towards enjoying singleplayer adventures, with EA FC (formerly FIFA) being the only online game he is active in. Though, perhaps due to being ultra-focused on the game, he is today a semi-pro on the EA FC scene, regularly participating in tournaments and sometimes even taking back prize money.

Because of his enthusiasm for anime and games, he also self-learned Japanese along the way to consume some of the untranslated gems out there. The skill didn’t merely remain as just a hobby, either, as he put it to productive use during his exploration for small-time gigs at the start of COVID, fulfilling a couple of Japanese-to-English translation jobs.

Keshav is also big into fitness, with agility and acceleration-related workouts making a big part of his program due to the relevance they have in football. On top of that, he also has a more traditional strength based program for the gym, which he does to maintain an overall fitness level of his body.

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