Bitcoin Miner Outflows at 11-month High After Market Rejects $30K
The last time Bitcoin miner outflows were this high, BTC crashed from $30,000 to below $19,000 in less than two weeks
SimpleB/Shutterstock, modified by Blockworks
Bitcoin miner outflows have reached their highest point in almost a year as BTC struggles to capture $30,000.
Glassnode’s Bitcoin Miner Outflow Multiple, which tracks the ratio of BTC moved by miners to the amount mined, has reached an 11-month high of 1.104. Back then, BTC was collapsing from a similar valuation to below $19,000.
The outflow metric doesn’t explicitly track funds sent from miners’ addresses to crypto exchanges — which might indicate sales. Still, outflows serve a rough guide for their sentiment: more outflows suggests less holding overall.
Bitcoin has struggled to push and hold above $30,000 for over the past six weeks. BTC is about flat over the day, hovering at $27,680, having slipped around 4.2% across the past five days.
Proof-of-work miners are rewarded with BTC for spending electricity to validate transactions. Higher energy costs, market fluctuations and the need to cover operational expenses could all be contributing to increased outflows
Historically, miner selling pressure is often associated with short-term price corrections, as increased supply on the market can lead to temporary imbalances between supply and demand.
That’s best reflected in outflows’ previous high last year, when bitcoin fell as much as 30% across eight days in June.
Publicly-listed Bitcoin miners are indeed opting to sell more of their mined crypto, as opposed to more stoic holding strategies.
But Bitfinex in an analyst note cited Bitcoin’s recent hashrate record as reason to be hopeful over the short term, as it signals it “miner confidence in the future value of Bitcoin.”
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