Bitcoin (BTC) Miner reserves have experienced a consistent decline over the past year in a rather worrying development. However, Bitcoin has recorded several price rallies during this period, even entering the $100,000 price zone. CryptoQuant analyst cryptoavails has provided some insight into this diverging trend that pinpoints the driving force behind the current bullish market.
Bitcoin Miners Unload 37 Million BTC Amid Selling Round
In one Quick post on X, cryptoavails shares that Bitcoin miners’ holdings have decreased since the second half of 2023, falling from 1.808 million BTC to its current value of 1.808 million BTC.
Generally, when miners’ reserves rise, it indicates accumulation which is interpreted as a bullish signal. On the other hand, a decline in miners’ holdings due to high operating costs or profit taking represents significant selling pressure that can create bearish sentiment.
However, amid the ongoing offloading of Bitcoin miners, cryptoavails highlights that the premier cryptocurrency has registered a remarkable periodic price growth rising to a current value of around $103,000. The cryptanalyst explains that this unusual behavior indicates that other market participants ie private and institutional investors have shown strong demand to remove all selling pressure from the miners.
For example Bitcoin Spot ETFsintroduced in January 2024, any increase in inflows that allowed for a price rally has proven to be monumental in BTC price growth. According to data from SoSoValue, The Bitcoin Spot ETFs currently have total net assets of $114.82 billion despite being on the market for just over a year, representing huge institutional demand for the premier cryptocurrency.
Interestingly, cryptoaails notes that a continuous decrease in miner reserves would eventually result in reduced selling pressure, likely due to less BTC available to sell, thus contributing to a higher potential for price gains in the future.
BTC to enter consolidation?
In other news, popular market analyst Rekt Capital has postulated a price move necessary for Bitcoin to maintain its current rally and avoid another consolidation. At press time, the premier cryptocurrency is trading at $103,114 after gaining 2.10% in the last 24 hours. Meanwhile, its daily trading volume has increased by 16.95% and is valued at $65.8 billion.
Recht Capital states BTC needs to register a daily close above its final resistance of $106,000 followed by a retest to confirm a price breakout and incoming new all-time high. However, if BTC fails to clear the specified resistance zone, the asset is expected to trade between $101,000-$106,000 in the short term, thereby forming a consolidation zone.
Featured image from Coinformania, chart from Tradingview
