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On-chain data shows that Bitcoin miners have conducted an unusually large number of transactions on centralized exchanges recently.
Bitcoin miner exchange transactions have seen a huge rise
As the author of CryptoQuant IT Tech points out in a new article mail On X, the Mining Transaction Index has been high recently. Mining-to-Exchange Transactions tracks the total number of transfers made by mining-related Bitcoin wallets to addresses associated with exchanges.
When the value of this metric is high, it means that miners are making a large amount of movement to these platforms. Since one of the main reasons why these validators deposit on exchanges is for selling purposes, this type of trend can have a downward impact on the price of BTC.
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On the other hand, a low index indicates that miners are not making inflows to exchanges, perhaps because they plan to hold on to their coins for a while. Naturally, such holding from this group could be a positive sign for the asset.
Now, here is a chart showing the trend in Bitcoin Miner to Exchange transactions over the past few days:
As shown in the chart above, Bitcoin miner exchange transactions recorded a significant spike over the past day, indicating that miners have just made a large number of moves to these platforms.
This could be an indication of a sell-off from this chain, but whether this potential sell-off will actually impact the cryptocurrency depends on the exact volume of coins involved in the transactions.
The analyst also shared data for the indicator he provides information about, called Miner to Exchange Flow:
From the chart, it seems clear that the value of this metric has also risen along with the significant rise in mining transactions to the exchange. At its peak, the scale reached 225 bitcoins, which equates to just under $15.4 million at the current price.
This is not a small amount in itself, but when considering the size of Bitcoin’s total market cap, these exchange flows hardly carry much weight. Therefore, even if miners plan to sell these coins, the market should be able to absorb the pressure well.
Miners are entities that have fixed operating costs in the form of electricity bills, so they tend to be regular sellers. Most of the time, their sale remains limited, bringing the last value of a miner’s flow to the exchange in line with the norm.
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However, the number of individual transfers to exchanges made by miners is certainly unusual, so these indicators can be monitored in the coming days, in case more spikes appear.
Bitcoin price
Bitcoin crossed the $69,000 level on Sunday, but the asset appears to have fallen to $68,200 today.
Featured image from Dall-E, CryptoQuant.com, chart from TradingView
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