Bitcoin Miner Selling Power Plunges, Green Signal For Price?

Keshav Verma

Last Updated: June 11, 2024 2:33 pm

3 mins read

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On-chain data shows the Bitcoin miner selling power has plunged recently, a sign that could be positive for the crypto’s price.

Bitcoin Miner Selling Power Has Plummeted In Recent Days

As pointed out by an analyst in a CryptoQuant post, there has been less selling pressure from the miners recently. There are two relevant indicators here, the miner supply and the miner outflow. The first of these, the miner supply, is simply a measure of the total amount of Bitcoin currently sitting in the wallets of miners.

The other one, the miner outflow, is a metric that keeps track of the total number of coins that miners are transferring out of their supply at the moment. Now, the “miner selling power” is defined as this miner outflow divided by the miner supply (30-day moving average, log-scaled).

When the value of this indicator is high, it means miners are transferring out large amounts compared to their total supply right now. Since miners usually take out their BTC for dumping purposes, this trend can be bearish for the value of the crypto. On the other hand, low values suggest miners are spending relatively little amounts currently.

The below chart shows the trend in the Bitcoin miner selling power over the last few years:

The value of the metric seems to have taken a plunge in recent days | Source: CryptoQuant

As the above graph displays, whenever the Bitcoin miner selling power has reached high values and set a local peak, the price of the crypto has seen some downtrend. This trend makes sense as highs in the metric suggest increased selling pressure from these chain validators.

Recently, the indicator again showed such a formation, and BTC reacted with a decline this time as well, as its price went from more than $18,000 to the current $16,000 level. However, since this recent peak, the miner selling power has been rapidly going down and has now set a new low.

This muted selling pressure from miners may not necessarily be bullish by itself, but it does mean that if Bitcoin shows any bullish momentum now, miners wouldn’t provide any impedance to it for the time being.

An interesting long-term trend to notice in the miner selling power chart is that the metric has been on an overall downtrend in the last five years or so. This means that over time, miners have been selling lesser and lesser BTC compared to their reserves, suggesting that they have been accumulating and growing their supply instead.

BTC Price

At the time of writing, Bitcoin’s price floats around $16,800, up 1% in the last week.

BTC continues to display boring price action | Source: BTCUSD on TradingView

Featured image from Jievani Weerasinghe on Unsplash.com, charts from TradingView.com, CryptoQuant.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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