Bitcoin Miners to Dump $5 Billion in BTC Following Halving

Bitcoin miners have increased the pace of selling their Bitcoin reserves. The report noted that the selling spree can last up to 4-6 months after the halving event.

Bitcoin Outflow by Mining Firms

The analyst noted that the total amount of Bitcoin sold by miners may be valued at $5 billion. There is a massive Bitcoin outflow from mining firms in the months after the halving event in historic events.

The data projections shared by 10x Research noticed that Bitcoin miners may liquidate $5 billion worth of Bitcoin in the aftermath of halving. These projections were conducted by Markus Thielen on 13th April who is the head researcher at the analytics firm.

The analyst further projected that the aftermath of this selling process can retain up to 4-6 months noting that Bitcoin prices can move in sideways for the next few months.

Thielen further stated that the same trend may recur that would witness the spot market in a 6-month summer lull state. Bitcoin prices remained in the range of $9k and $11.5K after 5 months of the 2020 halving. For the existing year, halving is going to take place on 20th April 2024. However, the market did not uptrend and remained in line with the historical price movements.

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Impact of Bitcoin Miners on BTC Price

The analysis report indicated that miners tend to stock Bitcoin that result in supply and demand instability. However, it can also lead to an eventual rally in Bitcoin prices that continues until the halving event.

The incident has already taken place with Bitcoin prices continuing to surge 74% in 2024 and reaching a new ATH of $73,734 on 14th March and trading at a support level of $63K during the middle of April.

Thielen further stated that altcoins specifically can also experience a considerable price loss on account of the recent situation. Several altcoins experience heavy price corrections during the past few weeks and a vast majority of them did not reach their previous ATHs as happened in 2021. The analysts noted that it can be on account of correlation between halving and altcoin rally.

Historical events indicated that price rally for altcoins typically begins after 6 months of halving. Thielen projected that Marathon the largest Bitcoin miner has setup an inventory that the firm may gradually sell approaching halving to avoid a sudden revenue drop. After the halving, the daily Bitcoin mining average of the firm will drop to 14-15 Bitcoin units per day.

The analysis projected that mining firms may opt to use a similar pattern to liquidate a portion of their inventories at a slow and steady pace. The researcher asserted that in case all miners keep using the same strategy to sell their inventories after halving this will result in a maximum return of $104 million of Bitcoin sold per day. In this manner, miners will bridge the gap that allowed Bitcoin to rally pre-halving.

Last week, Marathin CEO Fred Thiel noted that the break-even rate of the firm is noted about $46K per Bitcoin to remain in profit after profit. He projected that there is unlikely chance of any big price leaps in the upcoming 6 months following the halving event.  

New Token Standard on Bitcoin

Another report published in Cointelegraph noted that Runes accounts for 68% of all Bitcoin transactions. Runes is a new token standard on Bitcoin that accounts for 2/3rds of Bitcoin transactions since it was launched on 20th April.

More than 2.38 million transactions have been processed through the network as per Dune Analytics. The count is inclusive of peer-to-peer transactions, BRC-20s, and Ordinal transactions.

The biggest day for the token standard was on 23rd April when it reached a new ATH of 750 thousand transactions with the total count dropping down to 312 thousand within 24 hours. The majority of the transaction traffic on Runes was generated from meme coins such as Rare Satoshis on Runes protocol.

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