Bitcoin Miners Increase Selling Activity As BTC Demand Growth Slows – CryptoQuant

CryptoQuant analysts have found that Bitcoin miners have increased their selling activity over the past month amid slow growth in BTC demand.

According to CryptoQuant’s latest weekly report, the decline in demand for BTC is evident in low demand for Bitcoin whales, fewer purchases of exchange-traded funds in the United States, and Coinbase’s premium falling below zero.

Miners increase selling activity

Miners have sent a large amount of BTC to detect exchanges, creating an imbalance in the market. Since the halving was completed on April 19, miners’ earnings have dropped significantly following the 50% reduction in block rewards.

Currently, mining entities sell their stakes to cover operating costs; however, if the trend continues and miners’ profitability turns negative, BTC price may witness more pressure.

Due to the high selling activity of miners, the supply of BTC exceeds the demand. CryptoQuant’s head of research, Julio Moreno, revealed yesterday that the total balance of BTC on over-the-counter (OTC) tables began to rise when the crypto asset peaked at $73,000 in mid-March. OTC supply has remained on the rise since then, reaching its highest level since November 2022, but demand has slowed.

BTC demand slows down

Monthly BTC demand growth from permanent holders (investors who buy BTC and never sell) has plummeted by 50%, from 200,000 BTC at the end of March to 96,000 BTC at the time of writing. Analysts noted that demand growth needs to accelerate for prices to fall and eventually rise.

Demand growth from large investors and Bitcoin whales has also fallen from a peak of 12% at the end of March to 6% currently. Spot Bitcoin ETFs in the United States have recently seen significant outflows and little or no inflows, declining significantly from a mid-March high of $1 billion.

In addition, the funding rate in the perpetual futures market has fallen to its lowest level this year, indicating that sell orders are outpacing buy orders and traders are not willing to pay as much as before to open positions long Traders are also opening more short positions in anticipation of further price declines.

With BTC hovering around two-month lows of $60,000, the asset may target $55,000 to $57,000 in the near term. This range is 10% below the traders’ current cost base of $63,000, a level that acts as support during bull markets.

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