A quant has explained how a rally could be possible for Bitcoin in Q3 2024 as selling pressure from miners fades.
Bitcoin Miners Appear to Have Stopped Selling
In a summary of CryptoQuant publishan analyst talked about how concerns about miners’ selling pressure have been resolved recently. There are two on-chain focus indicators here.
Related Reading
The first of these is the “Miner to exchange transactions”, which, as its name suggests, monitors the total number of transactions going from miner-related wallets to exchange-affiliated wallets.
When this metric is high, it means that miners are making a large number of deposits to exchanges. Typically, the main reason why these chain validators might transfer their coins to these centralized entities is for sales-related purposes.
As such, this type of trend can have potential bearish consequences for the market. Low values of the indicator, on the other hand, can be neutral or bullish for the asset, as they imply that miners are possibly not participating in any selling through these platforms.
Now, here is a chart showing the trend of Bitcoin Miner to Exchange transactions over the past year:
As visible in the chart above, Bitcoin Miner to Exchange Transactions has been increasing between the end of 2023 and the end of April this year. This upward trend in the metric occurred when the price of the cryptocurrency itself was on the rise.
It appears that miners saw the rally as an exit opportunity, as they gradually increased their selling pressure as the price headed lower. new all-time high (ATH).
It is also clear, however, that since the peak in April, the indicator’s value has seen a very rapid decline. Thus, it is possible that miners’ appetite for sales has cooled.
However, exchanges are not the only way miners sell, as over the counter (OTC) tables are also a popular option among these chain validators. Below is a chart showing the trend of Total OTC Desk Balance, which is an indicator that tracks the non-exchange, non-mining wallets that miners send to when they want to sell.
![Bitcoin Q3 Rally Possible as Miner Liquidation Ends, Says Quant 1 Bitcoin OTC Table Balance](https://thegurumedia.com/wp-content/uploads/2024/07/zPkn7pp_34dbbd3f9ded1b1e9b3d2795417f499e073e2dc9daddfdb9f7b7aa6ab45a2fe6.png)
From the chart, it is visible that the total balance of OTC desks was at relatively high levels just before, suggesting that these entities, which are likely OTC desks, held a large number of coins.
Related Reading
In recent days, however, the indicator has seen a sharp drop, potentially implying that the coins that had accumulated in these wallets have now found a buyer.
Thus, it appears that miners have eased the selling pressure on exchanges and the coins they were waiting to sell on OTC desks have now also been absorbed. “Sufficient conditions have been created to continue the upward recovery again in Q3 2024,” the quant notes.
BTC Price
Bitcoin has shown some recovery over the past 24 hours as the asset’s price has now recovered above the $63,700 mark.
Featured image by Dall-E, CryptoQuant.com, chart by TradingView.com