-
In the last 24 hours, bitcoin rose around 4% in its price.
-
If miners sell their bitcoin holdings and demand does not respond, the price may fall.
Sales by Bitcoin (BTC) miners are declining, which could be one of the factors why the price of BTC rebounded upwards this January 6, 2025.
At the time of this article, bitcoin is trading in the $102,000 area. In accordance with the low levels of sales of minersand according to CoinMarketCap, the price of bitcoin rose more than 4% in the last 24 hours.
The person who detailed the current sales levels of miners, and their correlation with movements in the market value of bitcoin, was Charles Edwards, founder of the investment firm Capriole.
The manager shared his analysis accompanied by the following graph.
At the top of the image, the price of BTC is shown by a daily candlestick line, while at the bottom, a blue line represents the «Bitcoin Miner Sell Pressure» (Selling pressure from miners, BMSP), where the peaks indicate periods of greater sales by them. Pink shaded areas highlight these spikes, which coincide with bitcoin price corrections or pauses.
Less selling by miners equals less downward pressure
Edwards explains that when miners’ sales exceed the reference level of “1.0” (red box, bottom right of the graph above), it is a indicative that the miners are selling their bitcoin reserves. These sales can push the price of BTC downwards, if demand does not monopolize the new circulating supply.
For example, Edwards continued, it was observed that this metric exceeded that level at the time that bitcoin marked $108,000, and then stop its upward climb and fall below $100,000. This validates the relationship between massive selling by miners and bearish corrections in the price of BTC.
Currently, according to the analysis of the Capriole executive, sales levels have decreased to levels of “0.75” (blue box in the graph).
This drop in miners’ sales, reflected in the BMSPis a positive indication for the current situation of bitcoin, since less sales mean less downward pressure on the pricepotentially allowing the value of BTC to continue its rise or not fall further.
This phenomenon, combined with other factors such as the imminent inauguration of Donald Trump as president of the United States and bullish expectations for 2025, are behind the bullish rally in the price of Bitcoin.