The blockchain analytics company Santiment has shared insights on how this might signal the onset of the next Bitcoin bull run.
Bitcoin Miner Supply May Be Crucial for Initiating the Next Bull Rally
In a recent post on X, Santiment highlighted the trend observed in the “Supply held by Miners” metric. This indicator reflects the total amount of Bitcoin currently stored in the wallets of miners.
When this metric increases, it indicates that miners are receiving a net influx of tokens in their wallets. Since miners continuously earn coins by solving blocks and receiving rewards, such inflows are typical.
However, significant and prolonged net inflows can be noteworthy, as they suggest that these validators are holding onto their coins, which can be a bullish indicator for the price.
Conversely, a decrease in this metric signifies that miners are sending a net amount of coins out of their wallets, likely to sell.
Here is a chart that illustrates the trend in Bitcoin Supply held by Miners over the past few months:
The metric appears to have been on a decline for some time now | Source: Santiment on X
As shown in the chart, the Supply held by Miners has been decreasing since around April, indicating that this group has consistently been transferring coins out of their wallets.
While outflows may suggest miners are selling, this typically does not have a significant impact on cryptocurrency prices.
Historically, miners frequently sell to cover expenses such as electricity costs. Nonetheless, their selling is often minor enough for the market to accommodate.
That said, the sell-offs observed in recent months have been notably consistent and could be contributing to the current consolidation phase of the asset.
The likely trigger for miners becoming net sellers is the recent fourth Halving, which took place in April and cut the Bitcoin block subsidy in half, significantly impacting miner economics.
Since this event, miners have been feeling the strain, and the prevailing bearish trend in BTC has only exacerbated their situation, compelling them to continue offloading.
Santiment points out that a turnaround in the Supply held by Miners could be an important signal to monitor, as it would indicate that miners are once again inclined to accumulate, serving as “a strong signal the next bull run is approaching.”
BTC Price
Currently, Bitcoin is priced at around $58,200, reflecting a 6% increase over the past week.
The price of Bitcoin has been on the rise in recent days | Source: BTCUSDT on TradingView
Featured image from Dall-E, Santiment.net, chart from TradingView.com
