Institutional interest in Bitcoin might have led to new highs but miners always seemed to be the main proponents of Bitcoin price rallies.
In 2017 and 2020, there have been signs of miners’ involvement in the price rally. Bitcoin miner’s outflow has dropped to 68% since November 2020 and numerous miners are now choosing to hold on to their Bitcoin, even at its current level.
The active supply has been rapidly increasing because around 97% of the BTC wallets are profitable. The expectation is that the selling pressure will rise, nevertheless, miners might not have responded to the same as of now.
Miners had hodled through September and October 2020, getting ready for the profits in November 2020. It was another reason for an increase in supply to exchanges, and the rise in exchange reserves. Reserves boomed in November 2020, but long before hitting past levels, more latest supply was pulled out of the exchanges.
The total miner outflow is still at the average level, lower than the previous bull run. From 2017 until early 2018, miner outflow was much higher, although it considerably dropped in 12 months. During the 2019 price rally, with a little uptick in price, there has been another surge in miner outflow and the price rally is yet to register a hike in the TMO.
Miners are HODLing through the recent price level, anticipating more price discovery above $24K, and when the outflow starts increasing, it is a sign for the retail traders to watch price charts at a close range.
As the current price rally didn’t make spikes on Bitcoin’s price volatility and network momentum, it hasn’t displayed a boost in miner metrics yet. The price level around which TMO will start to increase, closer to the 2017 level, and maybe the new ATH for a few months unless more institutional activity or regulation bring about abrupt changes in Bitcoin’s market cycle.
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