Bitcoin miners are moving a lot less Bitcoin lately. What does this mean for the price of Bitcoin? Let’s dive in.
Miner Volume is Shrinking
A recent report shows a big drop in the percentage of Bitcoin transactions linked to miners. This “Miner Volume Share” is a key indicator tracking how much of the total Bitcoin movement on the network is coming from miners.
Think of it like this: If miners are moving 20% of all Bitcoin, that’s a significant amount. But if that drops to 5%, it suggests something’s changed.
A chart shows a clear downward trend over the past decade. There were brief spikes during Bitcoin’s price rallies, likely because miners were selling their coins to capitalize on the higher price. But the overall trend is consistently down.
Why the Drop?
There are a few possible explanations for this decline:
- Less to Sell: Miners might simply be running low on Bitcoin to sell.
- Increased Network Activity: More overall Bitcoin transactions could be diluting the miners’ share of the total volume.
- Halving Effect: Bitcoin’s “halving” event cuts the reward miners get for processing transactions. This means they have less Bitcoin to move around. Each halving seems to lead to a lower peak in miner volume share.
The current miner volume share is below 5%, lower than the 2017 bottom. However, it hasn’t yet reached the lows seen during the 2021 bull market.
What About Bitcoin’s Price?
Bitcoin’s price has also taken a hit recently, dropping another 2% and falling below $93,700. Whether this is directly related to the drop in miner volume is unclear, but it’s definitely something to watch.
