Bitcoin (BTC) experienced a drop to $42,824 as miners sold over 10,000 Bitcoin on January 17, marking the largest daily decrease in miner reserves in more than a year. According to data from CryptoQuant, Bitcoin miner reserves decreased by 10,233 BTC on that day, equivalent to approximately $450 million at current market prices.
Miners typically alternate between phases of accumulation and selling. A 2023 Bitfinex report highlighted that miners started accumulating Bitcoin in mid-2023 during periods of lower prices and profitability. As prices and profitability rise, as seen in recent months, miners transition to a selling phase. Historically, miners sell their coins to replenish cash flow or take advantage of higher prices during a rally. The price of Bitcoin has hovered in the $42,000 to $43,000 range in recent days.
The data further reveals that Bitcoin miner reserves are currently at their lowest levels since July 2021, totaling 1.83 million coins. Despite the decrease, this remains a substantial reserve valued at approximately $78 billion.
In the last 12 months, BTC miner reserves have seen a decrease of 22,800 BTC, although the overall reserve figure has remained relatively stable since early 2021.
On January 15, CryptoQuant observed a rise in the Bitcoin Miners’ Position Index (MPI), suggesting that potential selling activities were on the horizon. The MPI is calculated as the ratio of total miner outflow to its one-year moving average of total miner outflow. On January 14, Cointelegraph reported that Bitcoin mining firms Riot, TeraWulf, and CleanSpark were well-prepared to navigate significant cost increases anticipated after the BTC halving event in April or May.
Additionally, average hash rates have declined to their lowest levels since October, hovering around 400 exahashes per second, according to Bitinfocharts.
Meanwhile, in response to severe cold weather conditions, several major mining facilities in Texas have recently scaled down some of their operations to conserve energy for the state, as reported by Cointelegraph.