Bitcoin is currently facing downward pressure as miners are offloading a significant amount of BTC, leading to concerns of a potential price drop to $62,500, according to analyst Willy Woo.
Woo has warned that the selling pressure from miners could result in a bearish trend for Bitcoin. Typically, when the supply of Bitcoin exceeds demand, it usually leads to a decrease in price.
Miners often sell the coins they receive to cover operational costs. Sometimes, they hold onto their stash in hopes of a price increase, but when they need to pay bills or are not optimistic about a price rally, they tend to sell quickly.
Recent data from CryptoQuant’s Head of Research, Julio Moreno, shows that miners sold 1,200 BTC on Monday, marking the largest daily miner selling since March. This suggests that miners are either under pressure or bearish on the digital asset.
Furthermore, the transactions are taking place over-the-counter (OTC) rather than on popular crypto exchanges, indicating that miners are being discreet about their trades to minimize the immediate impact on BTC prices. OTC data reveals that Bitcoin OTC desk balances for miners have surged by 54,000 BTC, reaching a year-high.
Analysts attribute the recent miner behavior to the Bitcoin halving event, which occurs every four years and halves the reward offered to miners. This reduction in profits often leads to miners exiting the space, causing a decrease in supply. Historically, BTC prices have surged to new all-time highs following halving events, but with prices failing to sustain bullish momentum this time, miners may be facing financial difficulties.
Given the current miner activities, Woo warns that the increased supply could result in further bearish pressure, potentially pushing the price down to the $62,500 support level.
Despite these concerns, Bitcoin is currently trading at $69,764 after a 4% increase in the last 24 hours, recovering some of its weekly losses. Investor interest in the digital asset remains high, with an increase in Bitcoin ETF inflows. Spot Bitcoin ETFs in the US reportedly acquired a significant amount of Bitcoin in the past week, equivalent to two months of mining supply and more than eight times the new BTC mined during that period.
If this demand continues, the selling pressure from miners may have little to no negative impact on Bitcoin prices.