Bitcoin Bearish Signal: Miners Sell Third Largest Ever

On-chain data suggests that bitcoin miners may have been selling at a historic rate recently, which could be bearish for the asset’s price.

Bitcoin miner inflow to exchanges has registered a spike recently

According to data from on-chain analytics firm glassnode, Miner exchange inflow recently touched an all-time high of $70 million. “Miner inflow to exchanges” is an indicator that measures the total amount of bitcoins that miners are transferring to the wallets of all centralized exchanges.

When this metric has a high value, it means that miners are currently sending a large number of coins to these platforms. Typically, these on-chain validators deposit their BTC into exchanges for purposes related to selling, so such a trend could have a bearish effect on the cryptocurrency’s value.

On the other hand, the low prices suggest that the selling pressure coming from miners may be low for now, as this cohort is not depositing any significant amount into the exchanges at the moment.

Now, here is a chart that shows the trend in bitcoin miner flow across exchanges over the past few years:

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

As shown in the graph above, bitcoin miner inflow into exchanges has seen its value increase recently. This shows that miners have been sending large amounts of money to these platforms during the past few weeks.

These high values ​​of the indicator have come as the cryptocurrency is slowly moving to the downside. This could mean that the recent market environment has caused some miners to sell their holdings.

As these inflows have increased, the asset’s price has only extended its decline, as it has now dropped below the $26,000 level. This recent drop in prices may be partly due to the dumping being done by this cohort.

From the chart, it is visible that the indicator reached a value of around $70.8 million at the peak of these inflows observed on 3 June. This is a historically exceptional level for the metric as miners have made massive deposits in just two trading days over the entire lifetime of the coin.

Both instances where miners sent large amounts to these platforms happened in early 2021, when the bull market was in full flow. The peak inflow increase at that time (i.e., the largest value ever recorded by the metric) was measured at approximately $101 million, meaning the current surge is about $30.2 million away from it.

Naturally, bitcoin miners selling at such high rates recently could be bad news for the market. It remains to be seen whether these chain validators will continue to sell more in the near future, or if they are finished with their dumping spree for now.

btc price

At the time of writing, bitcoin is trading around $25,900, down 3% over the past week.

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

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