The initial drop of Bitcoin below $9,000 coincided with a massive inflow of BTC into exchanges and Bitcoin on-chain data indicates key players were selling over the weekend.
According to data, miners, exchanges and retail investors may have led to the decline in the price of Bitcoin over the past three days.
Who is selling Bitcoin?As cryptocurrency investor Willy Woo previously explained, the role of an exchange is to match orders between sellers and buyers.
If a buyer is purchasing Bitcoin at $9,000, a seller has to be selling BTC at the same price for the trade to come through.
When miners sell the BTC they mine and exchanges sell the fees they generate, they place external selling pressure on Bitcoin.
According to data from CryptoQuant, the inflow of Bitcoin spiked to 2,435 BTC on May 24.
Crypto trading platforms generate revenue through trading fees and an exchange can simply sell the fees on their own exchange without moving large sums of BTC around.
In the past week, ByteTree shows miners generated 5,231 BTC and spent 5,846 BTC. Simply put, miners sold 614 BTC on top of selling all the Bitcoin they mined within a seven-day period.
Whether miners are selling more than they mine because BTC is above the breakeven cost of mining in China or over-leveraged miners are capitulating remains unclear.
The data points show miners were most likely leading the sell-off of Bitcoin in the $9,300 to $9,400 range, along with retail investors on Coinbase moving to sell BTC..
Spike in BTC Exchange Inflow Preceded Bitcoin Price Correction to $8.6K
gepubliceerd op May 25, 2020
by Cointele | gepubliceerd op Coinage
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