Bitcoin Miner and HODLer Selling Pressure Running Out, Data Shows

On-chain data suggests that selling pressure from bitcoin miners and HODLers has been running out, a sign that could be positive for the asset.

bitcoin LTHs Stop Selling, While Miner Distribution Slows Down

As analyst James Van Straten explains in a twitter.com/jvs_btc/status/1782588621997907987″ target=”_blank” rel=”noopener nofollow”>mail On x, two btc groups in particular have been a source of significant selling pressure in the market recently: long-term holders (LTH) and miners.

LTHs refer to investors who have held their coins for more than 155 days. These holders are considered the decisive side of the sector, as they rarely sell, regardless of what is happening in the broader market.

However, the rally to the new all-time high this year managed to attract even these HODLers to sell their coins and reap the profits they had made during their long holding time.

However, according to Straten, the liquidation of these investors has recently dried up. “LTHs have remained relatively stable over the past few weeks as btc fluctuates, which is a good sign that profit taking is tapering off,” the analyst notes.

However, unlike LTH, miners, who represent the other major source of selling pressure in the market, have continued to distribute recently. However, as the chart below suggests, sales of these chain validators have at least been declining in scale.

<img decoding="async" class="alignnone aligncenter" src="https://technicalterrence.com/wp-content/uploads/2024/04/Bitcoin-Miner-and-HODLer-Selling-Pressure-Running-Out-Data-Shows.png" alt="bitcoin miners” width=”1800″ height=”1013″/>

The value of the metric seems to have been becoming less negative in recent days | Source: twitter.com/jvs_btc/status/1782588621997907987/photo/1" target="_blank" rel="noopener nofollow">@jvs_btc on x

The graph shows the monthly balance change data for miners as a whole. This cohort had become sellers in November and had maintained sales at a more or less constant rate over the following months, as the monthly balance change had remained around the same notable red values.

However, recently the metric has been trending upwards and although it remains negative, the latest value has been the lowest since the sell-off began as miners sold only 1,300 btc in the last 30 days.

The analyst suggests that this group could even soon become a net accumulator, as “the halving forces miners to be more efficient. “Weak miners are purged and fewer sales come to the market.” The halving here, naturally, refers to the periodic event on the btc network where block rewards are permanently halved.

Block rewards are what miners receive for solving blocks on the network and serve as the main component of their income, so these events have important consequences for this group. Halvings occur approximately every four years and the last one occurred just a few days ago.

With the selling pressure from these two cohorts, which had been actively distributing recently, now drying up, bitcoin can perhaps finally regain its bullish momentum from before, at least to some extent.

btc Price

bitcoin has been recovering somewhat from its recent lows, but the overall picture is that the asset is still consolidating within its recent range as it trades around $66,600.

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The price of the asset has been stuck in sideways movement for a few weeks now | Source: BTCUSD on TradingView

Featured image by Kanchanara on Unsplash.com, Glassnode.com, TradingView.com chart