Bitcoin (BTC) whales on Binance seem to be cutting back on their selling pressure; however, a rise in BTC sales from miners could bring about new downward forces in the market.
As per CryptoQuant’s community analyst Darkfost, the whale activity on Binance, which processes some of the largest Bitcoin trading volumes, is indicating a decline.
The exchange whale ratio, a metric that measures the ratio of the top 10 inflows to the total inflows on an exchange, is on the decline. High values of this ratio typically reflect increased activity from large holders, often indicating heightened selling pressure.
Conversely, a lower exchange whale ratio hints that whales are holding back from selling significant amounts of Bitcoin, which has historically linked to market stabilization or the start of bullish trends.
Should this trend persist, it may suggest that the recent market correction is drawing to a close. This metric has previously served as a leading indicator for potential trend reversals, making it an essential element to monitor in the current market situation.
Possible pressure from miners
Even as whale activity on Binance decreases, Bitcoin miners may emerge as a new source of selling pressure. CryptoQuant verified author Axel Adler Jr. pointed out that miners are facing conditions reminiscent of those following the latest Bitcoin difficulty adjustment, which often precedes miner capitulation.
Miner capitulation refers to scenarios where miners are compelled to sell Bitcoin to meet operational expenses. This typically occurs when mining profitability wanes due to rising costs or falling prices.
If miners liquidate their holdings, an influx of additional supply can enter the market, potentially negating any reduction in selling pressure from whales.
Historically, miner capitulation has resulted in notable market shifts. The degree to which miners will sell in the current circumstance remains unknown, but their actions will play a crucial role in determining Bitcoin’s short-term price direction.
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