- March saw a surge in BTC mining-to-exchange activity.
- Miners are trying to cash in on the currency’s current rally.
Bitcoin [BTC] Miner-to-exchange activity has seen a spike ahead of the next halving scheduled for around mid-April, on-chain data shows.
This pre-programmed event halves the reward for mining a block, with the aim of controlling inflation by limiting the issuance of new Bitcoins.
According to data from CryptoQuantBTC’s miner reserve has been slowly decreasing since February 26. This metric measures the number of coins held in the wallets of affiliated miners.
When its value drops, it suggests that miners are unloading their coins.
The BTC miner reserve stood at 2 million BTC at the time of writing and has fallen by almost 2% over the past two weeks.
Source: CryptoQuant
In a new reportCryptoQuant analyst Joao Wedson noted that March so far has been characterized by:
“A consistent flow of Bitcoin from miners’ wallets to exchanges.”
When there is an increase in miner-to-exchange activity on the Bitcoin network, it suggests that miners are selling more BTC than they are mining.
According to CryptoQuant data, the daily flow of BTC from miners’ wallets to exchanges has increased by more than 1000% in the past seven days.
Wedson also attributes this current increase to the upcoming halving.
Due to the expected drop in mining rewards, miners on the Bitcoin network are currently under pressure to sell their holdings and make a profit before mining costs exceed the rewards.
According to Wedson:
“The logic behind this is simple: with the reduction in rewards, the pressure to sell and ensure profitability before mining costs may become disproportionate to the reward. This preventive action may be an attempt to mitigate the risks associated with the reduction in mining revenues.”
Rally above $70,000 leads to…
At the time of writing, BTC was at $68,369. On March 8, the price briefly rose above $70,000, reaching a new all-time high. CoinMarketCaps facts.
Read Bitcoin’s [BTC] Price forecast 2024-2025
With the futures market recording mostly positive funding rates, the price jump above $70,000 resulted in a liquidation of short positions worth $58 million per month. Mint glass’ facts.
Source: Coinglass
On the same day, long liquidations totaled $50 million.