The launch of Bitcoin exchange-traded funds (ETFs) in the US directly impacted miners' BTC reserves, with more than $1 billion of BTC moving from miners' wallets to exchanges in the first 48 hours of trading.
According to the latest Bitfinex Alpha market report reflecting on-chain data, the second day of Bitcoin ETF trading on January 12 saw a significant increase in the outflow of Bitcoin miners to exchanges. Citing data from Glassnode, the report found that more than $1 billion in Bitcoin (BTC) was sent to exchanges from wallets associated with miners on the same day, marking a six-year high for miner outflows.
February 1 also saw another significant amount of BTC withdrawn from miners' wallets: 13,500 BTC was sent to exchanges. The report also notes that approximately 10,000 BTC was sent back to miners' wallets on February 2, suggesting that this activity may also be related to rebalancing of specific mining company wallets.
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Bitfinex analysts suggest that the net outflow of 3,500 BTC in one day is the highest value seen since May 2023.
The report adds that on-chain data reflecting the flow of Bitcoin from miners' wallets has been predominantly negative since the approval of the Bitcoin ETF in the United States. According to CryptoQuant, net miner outflow is approximately 10,200 BTC.
The factors influencing the outflow of BTC from miners’ wallets are multifaceted. The report mentions the need for operational liquidity for miners, as well as varying reactions to market conditions and adjustments following the approval of a Bitcoin ETF. Analysts add that some miners may also have tried to benefit from rising prices in the weeks before the ETFs were approved:
“This significant transfer of BTC from miners to exchanges reflects miners’ response to market conditions and perhaps their need to liquidate assets for operating expenses or risk management.”
While miners were seen withdrawing Bitcoin from wallets after the Bitcoin ETF was approved, on-chain data also suggests that long-term Bitcoin investors are holding onto the assets and are reluctant to sell them at current market prices.
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Referring to the last active supply indicator, analysts note a decline in last active supply over one-year and two-year time horizons. This activity was directly related to the Grayscale Bitcoin Trust, where dormant BTC assets were sold or exchanged for other Bitcoin ETFs.
“As a result, a significant volume of BTC, which had been dormant for an extended period, began circulating in recent weeks.”
The report notes that the movement of old Bitcoin offerings is a prominent indicator of market behavior, reflecting changing sentiment and strategies of investors who are reacting to Bitcoin ETFs or repricing positions in response to current market conditions.
Analysts say a significant portion of Bitcoin's supply is still tightly held. The trend in long-term ownership reflects continued belief in Bitcoin's future growth.