The tides seem to have turned for Bitcoin miners as they witness the highest Bitcoin sales. Bitcoin miners have moved into selling mode as they offload over 10,000 BTC tokens in a single day on January 17.
Subsequently, the miner reserves hit the largest daily decline, accounting for a new yearly low.
Bitcoin Miners Initiate The Selling Stage
Data from the on-chain analytics site CryptoQuant revealed that Bitcoin miner reserves plummeted by 10,233 BTC on January 17. The decline came through massive sales from the miners, which amounted to more than $450 million.
Notably, miners often undergo stages of accumulation and sales of mined tokens.
The 2023 Bitfinex report indicated that miners started accumulating BTC from the middle of last year. During this period, Bitcoin prices and profitability were quite low. Historically, miners often swing into the selling phase once there is a considerable increase in prices and profitability, as seen in recent months.
Miners want to sell off coins to furnish cash flow or partake in price hikes. Prominent crypto personality Ali called attention to the recent changes in a January 17 X post. He noted that Bitcoin miners scaled up their selling activity significantly within 24 hours on January 17.
🚨 #Bitcoin Miners in Selling Mode: Recent on-chain data from @cryptoquant_com indicates a substantial increase in selling activity by #BTC miners. In just the last 24 hours, they’ve offloaded nearly 10,600 $BTC, valued at approximately $455.8 million! pic.twitter.com/JEtasWfR6N
— Ali (@ali_charts) January 17, 2024
Within the past few days, the price of Bitcoin has been hovering between $42,000 and $43,000. Interestingly, Bitcoin miner reserves have reached 1.83 million tokens, the lowest since July 2021. The value still proves to be quite substantial, worth nearly $78 billion, according to current market prices.
Within the past twelve months, Bitcoin miner reserves dropped by 22,800 BTC. However, the overall reserve value has maintained relative stability since the beginning of 2021.
The Bitcoin Miners’ Position Index (MPI) initiated a gradual spike on January 15, with data from CryptoQuant showing a potential selling phase could kick off soon.
Notably, the MPI is a factor that measures the ratio of total miner outflow to its 12-month moving average of cumulative miner outflow. Recently, the CoinShares Mining Report highlighted that some Bitcoin mining companies like Riot, Cleanspark, and TeraWulf have stepped up their games.
They are viewed as the best-positioned to tackle the remarkable cost rise and implications that could emerge after BTC halving events in April or May.
Further, data from Bitinfocharts showed a decline in the average hash rates that hit the lowest points since October to approximately 400 exahashes per second.
Moreover, many of the big mining sites in Texas have taken steps to secure energy for the state. Recently, they shut down some of their operations, considering the prevailing winter.
Reacting to the situation, an X user, Dennis Porter, noted that the BTC hash rate has dropped below the 30-day average.
Porter stated:
Bitcoin hash rate plummets below 30-day average as #Bitcoin miners across the USA give back energy to balance the grid.
HUGE: #Bitcoin hashrate plummets below 30 day average as #Bitcoin miners across the USA give back energy to balance the grid. pic.twitter.com/TFvoZpkYfX
— Dennis Porter (@Dennis_Porter_) January 18, 2024
