Bitcoin price has been consolidating in the mid to high $9,000 range for nearly a month and a half. Repeated attempts to break and hold above $10,000 have been rejected thus far.
The most recent rejection, data shows, was largely fueled by miners who were seen moving BTC supply to exchanges just ahead of the most recent steep selloff. Is this miners capitulating, or simply taking advantage of high prices each time the cryptocurrency reaches the key resistance level?
Are Miners Responsible For The Latest Crypto Market Selloff?
In early 2020, Bitcoin and other cryptocurrencies went on strong rallies from lows set in the year prior.
All signs had been pointing to a new uptrend forming. Indicators had been supporting the incredibly bullish sentiment and price action.
Bitcoin price began to cool off after a visit above $10,000, but then the black swan impact of the pandemic struck financial markets, and all bullish price action leading up to the high was erased in under 48 hours.
The carnage is now referred to as Black Thursday.
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From the extreme panic low, Bitcoin price has grown over 140% and revisited above $10,000 numerous times.
Each time it’s pushed above the powerful resistance level, it has led to a strong rejection, the last of which, data indicates may have been driven by Bitcoin miners.
But why the sudden surge in selling post-halving? According to theories related to the halving, miners should be holding any new BTC mined not selling, so why is the inverse now happening?
Maybe miners did dump on us.#bitcoin pic.twitter.com/7WL3f8i3Lt
— Byzantine General (@ByzGeneral) June 13, 2020
Miner Capitulation And Competition May Be Purposely Pushing Bitcoin Prices Lower
Data analyzing the amount of BTC supply mining pools hold flowing into cryptocurrency exchanges shows an especially large movement preceding the most recent crash in Bitcoin price.
Speculation suggests that this Bitcoin was later market sold, causing the price of the asset to drop as a result.
Miners have been long expected to hold newly mined BTC post-halving, throwing off supply and demand, which could cause the start of a new uptrend in the digitally scarce asset.
Instead, however, miners have been selling even more BTC, even tapping into reserves.
While the halving could ultimately have the expected effect on the price per BTC, it may first require the weakest mining participants to capitulate and close up shop