Bitcoin withdrawals are a consequence of the halving held last May. These actions correct the price of the cryptocurrency, although they have not negatively impacted it yet.
CryptoQuant, the firm dedicated to the analysis of data on cryptocurrencies, recently presented information that indicates an important withdrawal of bitcoins. Last June 23rd went down in history as the day with the most Bitcoin outflow from the most important miners’ wallets in the ecosystem.
When this piece of news came out, analysts considered the bitcoin withdrawal flow registered that day to be the highest in history until now. Experts also indicated that this may lead to a Bitcoin (BTC) price correction, something that has already happened.
Last June 25th, 9,098 BTC exceeded the withdrawals registered by the main mining groups on May 20th. That May 20th was the start of a deep 10% drop in Bitcoin’s price, when it fell to levels below USD 9,000 per BTC, with less than USD 700 per BTC.
That drop was a consequence of the departure of less productive miners, after the halving reduced BTC’s reward per block. That event, which occurs every four years, seeks to make the distribution of bitcoins more equitable, but it makes mining less profitable for miners living in areas where electricity and the cost of mining are greater than the reward.
Now, another scenario related to the halving is taking place. Miners are withdrawing their BTCs and this may lead to further falls in the price of the cryptocurrency until the price stabilizes again and even rises. Miners withdraw a larger amount of bitcoins in an attempt to sell them and cover the expenses that mining generates, in addition to obtaining their profits.
Before the halving, another event sparked a massive bitcoin withdrawal. It was the economic crisis that arose in traditional markets as a consequence of the Covid-19 outbreak and the uncertainty surrounding the global economy.
This other massive withdrawal occurred on March 12th, a day the press called “Black Thursday.” That day, the leading cryptocurrency fell -50% in price. In this way, Bitcoin’s price was less than USD 4,000.
What will happen with the Price of Bitcoin?
Although it is too early to determine whether the price of Bitcoin will follow the negative behavior of the last two major withdrawals of BTC registered until today, currently the daily chart of BTC, according to CryptoQuant, indicates a small rebound above the monthly support area at USD 9,200 after registering a -4.75 % drop.
On the other hand, Glassnode also showed an important fact that would be contributing to the drop in the price of Bitcoin. According to this cryptocurrency analytics firm, the largest flow of Bitcoin from miners to crypto exchanges is happening.
“Yesterday, we observed the largest flow of Bitcoin from miners to exchanges in over a year. This was primarily due to large miner transfers to Bitfinex, totaling USD 2,650 BTC,” Glassnode said on Twitter. Likewise, Glassnode indicates that a group of miners with anonymous proxies removed 2,680 from an unknown pool titled ‘Others’.
Bitcoin withdrawals occur at a key time of the month. A significant sum of Bitcoin futures options expired. Some 114,000 Bitcoin options expired this June 26th for a value of USD 1 billion, according to Skew data.
Despite the drop in the price of Bitcoin recorded a few days ago, this does not completely affect the profitability of this quarter. The main cryptocurrency in the market continues in green numbers. Only a fall like that of Black Thursday could reverse the positive trend that Bitcoin has had in this second quarter of the year.
By María Rodríguez