HODL

bullish

Bitcoin

Simply

<h2 id="key-points">Key Points</h2>
<ul>
 <li>BTC miners are showing resilience, potentially leading to a supply shock in the cryptocurrency market.</li>
 <li>However, the lack of a clear market bottom reduces the impact of miner efforts.</li>
</ul>
<p>Bitcoin [BTC] bulls demonstrated their strength over the recent weekend, bouncing back from a dip at $52K. The ongoing volatility in leveraged positions makes the support from large holders increasingly important.</p>
<p>These large holders often include miners, who usually either capitulate or HODL during extended bearish periods. Thus, for a supply shock to occur, several key factors must fall into place. If these conditions are met, a potential price surge could follow due to the tightening supply in the market.</p>
<h2 id="miners-support-whales-retreat">Miners Support, Whales Retreat</h2>
<p>From an economic perspective, a significant crunch in BTC supply could be a key catalyst for a price correction. For a supply crunch to materialize, miners must transition past the distribution phase. Simply put, if miners offload less BTC, the supply shock could become more pronounced.</p>
<p>Interestingly, recent data shows that the 30-DMA has moved back above the 60-DMA, generating a hash ribbon buy signal. This suggests a potential bullish trend, reinforcing the possibility of a price correction driven by miner accumulation.</p>
<p>Currently, the total circulating supply of BTC stands at 19.7 million. Miners hold 1.8 million BTC, which is approximately 9.1% of the total supply. However, the proportion of BTC held by whale cohort wallets has decreased from 24% when BTC tested the $73K ceiling, to 21.9% at present.</p>
<p>This decline indicates a reduction in the concentration of large BTC holdings. While miner reserves have remained resilient, these routine deposits by whales have lessened the likelihood of a supply shock. Nevertheless, a turnaround is still possible if demand outweighs the selling pressure.</p>
<h2 id="understanding-the-mvrv-chart">Understanding the MVRV Chart</h2>
<p>The MVRV Z-score has historically been effective in identifying periods where market value is unusually high above the realized value. When the Z-Score enters the pink box, it often signals the peak of a market cycle. Conversely, when the Z-Score enters the green box, it suggests that BTC may be undervalued. Buying Bitcoin during these periods has historically yielded outsized returns.</p>
<p>Therefore, an advanced trader will monitor for the market bottom to identify the optimal “buy the dip” opportunity. Without sufficient holding evidence, the chances of a rebound diminish.</p>

Bitcoin Miners Controlling 9.1% of BTC: Could A Supply Shock Be on the Horizon?

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CoinEagle.com

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