On-chain data shows the volume of Bitcoin miners has seen a significant drop recently. Here’s what this might mean for inheritance.
Bitcoin Miners’ Volume Share Has Declined Slightly Recently
In a new post on X, market intelligence platform IntoTheBlock discussed the latest trend in Bitcoin Miners’ Volume Share. “Miner Volume Share” here refers to an on-chain index that keeps track of the percentage of Bitcoin transaction volume (ie, the amount of BTC involved in network transfers) made by miners-related transfers. until.
Below is a chart shared by a statistics company showing the trend in Bitcoin Miners’ Volume Share over the past decade.
The value of the metric appears to have been following a steep downward trajectory in recent weeks | Source: IntoTheBlock on X
As shown in the graph, Bitcoin Miners’ Volume Share briefly rose past the 20% mark last year when BTC saw its Q1 rally. This suggests that miners have been moving in large numbers on the blockchain, possibly taking advantage of the benefits afforded by the rush.
Since this peak, however, the price of the indicator has been declining. There was a temporary deviation late last year when BTC saw its new bull rally, which again meant that miners were looking to cash in. A short-lived selloff can suggest that miners run out of coins to sell. Another possible explanation for the trend, however, could be that the increase in activity across the network has forced the Miner Volume Share to decrease.
From the chart, it can be seen that the pattern has also been observed in previous bull markets, giving credence to the fact that it may be an increase in the volume of transactions caused by new capital inflows that often occur in such responsible times. for style.
It is clear, however, that the peak value of the metric has decreased with each cycle. The reason for this may be that the block grant, which miners receive as a reward for solving blocks and constitutes a large part of their income, is halved each cycle during an event known as the Halving.
Low-income miners naturally mean that they also have a low amount of money to exchange in the network, which will come from their share of the transaction volume.
Bitcoin Miners’ Volume Share has now dipped below the 5% mark, which means it has fallen below the 2017 cycle. However, it will still reach the same low as during the 2021 bull market.
BTC price
Bitcoin extended its losses by another 2% in the previous day as its price fell to the $93,700 level.
Looks like the price of the coin has been going down over the last few days | Source: BTCUSDT on TradingView
Featured image from Dall-E, IntoTheBlock.com, chart from TradingView.com