• Advertise
  • Submit a Press Release
  • About Us
NewsBTC

Bitcoin & cryptocurrency news

  • News
    • Bitcoin
    • Ethereum
    • Cardano
    • Dogecoin
    • Ripple
    • DeFi
    • NFT
    • Sponsored
    • Press Releases
    • Research
    • Gambling
      • Crypto Casinos
      • Real Money Casinos
      • Casinos not on Gamstop
  • Analysis
    • Bitcoin (BTC)
    • Ethereum (ETH)
    • Cardano (ADA)
    • Chainlink (LINK)
    • Litecoin (LTC)
    • Tezos (XTZ)
    • Zcash (ZEC)
    • EOS
    • YearnFinance (YFI)
  • Learn
    • Trading Course
  • Directory
    • Crypto Businesses
    • Bitcoin Brokers
    • Casinos
    • Sportsbooks
    • Categories
  • Events
  • CasinosTry
  • Play GamesTry
  • Play Casino GamesTry
  • Best Crypto CasinoTry
No Result
View All Result
Breaking News: Ethereum Price Cracks Above $2,000 As BlackRock Eyes ETH ETF
  • News
    • Bitcoin
    • Ethereum
    • Cardano
    • Dogecoin
    • Ripple
    • DeFi
    • NFT
    • Sponsored
    • Press Releases
    • Research
    • Gambling
      • Crypto Casinos
      • Real Money Casinos
      • Casinos not on Gamstop
  • Analysis
    • Bitcoin (BTC)
    • Ethereum (ETH)
    • Cardano (ADA)
    • Chainlink (LINK)
    • Litecoin (LTC)
    • Tezos (XTZ)
    • Zcash (ZEC)
    • EOS
    • YearnFinance (YFI)
  • Learn
    • Trading Course
  • Directory
    • Crypto Businesses
    • Bitcoin Brokers
    • Casinos
    • Sportsbooks
    • Categories
  • Events
  • CasinosTry
  • Play GamesTry
  • Play Casino GamesTry
  • Best Crypto CasinoTry
No Result
View All Result
Bitcoin News
No Result
View All Result
Breaking News: Ethereum Price Cracks Above $2,000 As BlackRock Eyes ETH ETF
Bitcoin price

Bitcoin Miner Capitulation Is An Exaggerated Fear, Analyst Claims

Jake Simmons by Jake Simmons
12 months ago
in Bitcoin
Reading Time: 3 mins read

Jaran Mellerud of Hashrate Index recently released a ‘comprehensive analysis’ on the thesis that a Bitcoin miner capitulation could put massive selling pressure on the market, causing a crash.  The topic has been a recurring part of the discussion in recent weeks as to whether the BTC bear market could be prolonged by the tight mining industry.

Charles Edwards of Capriole Investments stated two weeks ago that miner capitulation has begun, as indicated by hash ribbons. Investment giant VanEck also recently published an analysis that the bear market could extend into the second quarter of 2023 due to miner capitulation. The company predicted that BTC could bottom at $10,000 to $12,000 in Q1 2023.

Mellerud counters this assumption by saying that the miners’ total BTC holdings are not significant enough to move the spot market.

Are Bitcoin Miners Not As Powerful As Believed?

The Hashrate Index analyst writes that all miners must collectively own a significant portion of the circulating supply to have a meaningful impact. However, the question of the number of their holdings is a great mystery, although estimates do exist.

On-chain data providers such as CoinMetrics and Glassnode provide the best-known guesses, by grouping wallet addresses according to their proximity to the Coinbase transaction. Mellerud claims that these numbers likely significantly overestimate miners’ Bitcoin holdings. CoinMetrics estimates 820,000 BTC for all miners worldwide.

Related Reading: Bitcoin Price Prediction: Why BTC Could Still Tumble Below $16K

Another possibility is to derive the number from the Bitcoin holdings of public miners. Using these figures, Mellerud estimates 470,000 Bitcoin.

With 19.2 million BTC currently in circulation, miners thus hold only between 2% and 4%. “The public’s image of miners as enormous bitcoin holders and influential market participants might have been accurate ten years ago […]. Times have changed, and miners no longer hold a meaningful share of the Bitcoin supply,” Mellerud claims.

BTC Holdings By Miners Vs. Spot Volume

However, in terms of potential selling pressure, it is also important to know the size of the spot market to find out how well the market can absorb the selling pressure. According to Mellerud, the best way to estimate the absolute selling pressure of miners is to look at how much BTC they receive each day.

Generally speaking, about 900 freshly minted Bitcoins flow into miners’ wallets every day. When miners sell less than 100% of their production, they accumulate Bitcoin; when they sell more than 100%, they reduce their holdings.

The chart below shows that Bitcoin sales by miners peaked in June when they sold 350% of their production. For the rest of the year, the rate was 150% at maximum.

Public Bitcoin miners BTC sold by month
Public miners: BTC sold by month. Source: Hashrate Index

Using Binance spot volume, Mellerud shows in the chart below that a selling pressure of 100% of the production accounts for only 0.2% of the spot volume. At 200%, it represents only 0.4%, and at 300%, it is still only 0.6% of the total volume. Mellerud concludes:

Due to the small share of Bitcoin miners’ hypothetical volume compared to Bitcoin’s total spot volume, we see that Bitcoin should have more than enough liquidity in its spot market to accommodate the selling pressure from miners.

Miners potential btc sales as share of daily spot volume
Miners potential btc sales as share of daily spot volume. Source: Hashrate Index

In a worst-case scenario by Mellerud, in which all miners dump their entire holdings within 30 days (equally distributed over all days), the selling pressure of 470,000 BTC (4,900 BTC per day) would only amount to 1% of the total spot volume.

Related Reading: Bitcoin Price Poised To Continue Its Rally As Whales Turn Bullish After 14 Months

Only if the holdings actually amount to 820,000 BTC and they were all liquidated within 30 days, it might lead to a crash in the Bitcoin price, Mellerud says. Miners would then account for nearly 7% of the spot volume.

The Bitcoin price is currently experiencing a plunge of around 3.5% within the last few hours. At press time, BTC was trading at $17,035.

Bitcoin BTC USD 2022-12-16
BTC price, 4-hour chart. Source: TradingView
Tags: bitcoinbtcminer
Tweet123Share196ShareSend
Jake Simmons

Jake Simmons

Jake Simmons, a dedicated crypto journalist, has nurtured an unwavering passion for Bitcoin since 2016. Delving deep into the crypto world daily, he disseminates his profound insights and expertise to readers and the wider community. Jake is a firm believer in Bitcoin's transformative power over the conventional fiat currency system. Holding a degree in Business Informatics, Jake has been entrenched in the blockchain and crypto professionally since his graduation in 2017. Engage with his latest takes on Twitter: @realJakeSimmons.

Related Posts

Bitcoin

Bitcoin Cycle Analysis And Macro Factors Reveal When Price Will Reach $125,000

10 hours ago
Bitcoin $200,000 Small

Crypto Analyst Predicts Bitcoin 400% Surge To $200,000, Here’s When

16 hours ago
Why is Bitcoin price up today

Bitcoin Price Blasts Past $41,500: Here Are The Reasons

20 hours ago
Bitcoin bull

The Big Move: Crypto Pundit Predicts When Bitcoin Will Reach A New ATH

2 days ago
Bitcoin Miner

Bitcoin Miner Revenue Sees Massive 6-Month Crash – What’s Going On?

2 days ago
Bitcoin

Over 80% Of Bitcoin Holders Now In Profit – Report

3 days ago

Premium Partners

Top Casinos

BitStarz

BitStarz

Review · Visit
Punt Casino

Punt Casino

Review · Visit
Trust Dice

Trust Dice

Review · Visit
mBit

mBit

Review · Visit
Inmerion

Inmerion

Review · Visit

Press Releases

  • BC.GAME Honored with the “Best Casino Operator 2023”...

    10 hours ago
  • Bitcoin, Ethereum, Dogecoin Surge on Fed Remarks; Analysts...

    12 hours ago
  • Sui Prepares for Token Unlocks, Bearish Indicator? Dogecoin...

    14 hours ago
  • New Digital Wallet Tezro Aims to Revolutionize Banking

    18 hours ago
  • NEO ZENTECH Emerges: My NEO Group Announces Major...

    18 hours ago

About Us

NewsBTC is a cryptocurrency news service that covers bitcoin news today, technical analysis & forecasts for bitcoin price and other altcoins. Here at NewsBTC, we are dedicated to enlightening everyone about bitcoin and other cryptocurrencies.

We cover BTC news related to bitcoin exchanges, bitcoin mining and price forecasts for various cryptocurrencies.

Cryptocurrency news

  • Bitcoin
  • Ethereum
  • Ripple
  • Chainlink
  • Cardano
  • EOS
  • Tezos

Technical Analysis

  • Bitcoin (BTC)
  • Ethereum (ETH)
  • Ripple (XRP)
  • Chainlink (LINK)
  • Cardano (ADA)
  • Tezos (XTZ)

Company

  • Advertising
  • Comments Policy
  • Privacy Center
  • Sitemap
  • About Us
  • Contact

© 2023 NewsBTC. All Rights Reserved.

  • News
    • Bitcoin
    • Ethereum
    • Cardano
    • Dogecoin
    • Ripple
    • DeFi
    • NFT
    • Sponsored
    • Press Releases
    • Research
    • Gambling
      • Crypto Casinos
      • Real Money Casinos
      • Casinos not on Gamstop
  • Analysis
    • Bitcoin (BTC)
    • Ethereum (ETH)
    • Cardano (ADA)
    • Chainlink (LINK)
    • Litecoin (LTC)
    • Tezos (XTZ)
    • Zcash (ZEC)
    • EOS
    • YearnFinance (YFI)
  • Learn
    • Trading Course
  • Directory
    • Crypto Businesses
    • Bitcoin Brokers
    • Casinos
    • Sportsbooks
    • Categories
  • Events
  • Casinos
  • Play Games
  • Play Casino Games
  • Best Crypto Casino

© 2023 NewsBTC. All Rights Reserved.

This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy Center or Cookie Policy.