- Bitcoin surged by more than 7% as its price went above $46,000.
- On-chain metrics revealed high sell pressure on BTC.
Bitcoin [BTC] finally went above a crucial level, spurring hopes for a renewed bull rally. But just before that happened, BTC’s mining industry showed distrust in the king coin as a major sell-off took place.
Will this event hurt BTC and put its bull rally to an end?
Bitcoin jumps above $46,000
According to CoinMarketCap, in the last 24 hours alone, BTC’s price surged by more than 7%, allowing it to go above $46,000. At the time of writing, it was trading at $46,738.61 with a market capitalization of over $915 billion.
However, Bitcoin’s mining industry acted differently. AMBCrypto’s look at IntoTheBlock’s data revealed that a major mining pool sold a substantial number of BTC. Notably, F2Pool sold more than 1,000 BTC on the 5th of January 2024.
Moreover, the overall netflow of Bitcoin miners registered a downtick in the last week.
To investigate further, AMBCrypto checked Glassnode’s data. Our analysis revealed that most miners were selling their holdings, as shown by Bitcoin’s falling miners’ balance over the last 30 days.
A possible reason behind this could be the drop in miner revenue. As per CryptoQuant, BTC’s Miners Position Index (MPI) suggested that they were selling holdings in a moderate range compared to its one-year average.
AMBCrypto also noticed an outflow of miners from the Bitcoin mining industry. Coinwarz’s data revealed that BTC’s hash rate had declined sharply in the last week. At press time, the king coin’s hash rate stood at 483.89 EH/s.
Will this sell-off affect Bitcoin’s growth?
Though Bitcoin’s price action was bullish, a look at its on-chain metrics showed bearish indications. Notably, BTC’s exchange reserve had increased at press time.
Its net deposit on exchanges was high compared to the last seven-day average, meaning that selling pressure on the coin was high during this period.
Additionally, BTC’s aSORP was in the red at the time of the report, which meant that more investors were selling at a profit. In the middle of a bull market, it could indicate a market top.
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Things in the derivatives market also did not look optimistic, as the king coin’s Taker Buy Sell Ratio was in the red. This indicated that selling sentiment was dominant in the derivatives market.
Nonetheless, Bitcoin’s Open Interest remained bullish as it showed indications of rising alongside its price. Whenever Open Interest rises, it means an increased chance of trend continuation.