A recent on-chain analysis shows that Bitcoin miners have made large deposits to derivatives trading platforms, suggesting that they may be protecting themselves against possible future losses.
Bitcoin miners recently transferred to Derivatives Exchanges
A CryptoQuant analyst noted that approximately 4.3k BTC had been moved from the miner’s reserves in the past 2 weeks.
The “miner reserve” is an indicator that measures the total amount of Bitcoin currently stored in the wallets of all miners.
This metric is worth more than it was in the past. It means that miners are now transferring crypto coins to their wallets. Such a trend, when prolonged, can be a sign of accumulation from miners, and hence can be bullish for the crypto’s price.
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A lower value indicates that miners have stopped withdrawing coins. It could either be bearish or neutral depending on the location they are transferring.
Below is a chart showing how Bitcoin mining reserves have changed over the course of the last week.
The value of this metric seems to have fallen recently according to CryptoQuant| Source: CryptoQuant
You can see that Bitcoin miners’ reserves have declined in value in recent weeks, as you can see from the graph.
In total, these withdraws were approximately 4.3k BTC. In addition to this chart, data is available for two other indicators. The bottom graph shows netflow. This simply measures the movement of miner wallets. Naturally, it would equal the decrease of reserve.
In the middle graph are the curves of the flow from spot to derivatives, and the flow from miner to these exchanges. The majority of transfers made during that period were not for spot exchanges, but for derivatives.
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These coins could have been drawn up by miners as a hedge against potential Bitcoin price drops, rather than to be sold.
If that is indeed the miners’ intention, then the latest decrease in their reserves may not be bearish for the coin’s value.
BTC Prices
At the time of writing, Bitcoin’s price floats around $21.7k, up 13% in the last seven days. The crypto’s value has fallen 28% over the last month.
The chart below shows how the currency’s price has changed over the past five days.
Over the past couple days, the value of crypto appears to have seen some positive movement. Source: BTCUSD on tradingView| Source: BTCUSD on TradingView
Featured Image from Kanchanara, Unsplash.com. Charts by TradingView.com. CryptoQuant.com.
