Emily Walker
Recent on-chain statistics indicate a significant decline in the activity of Bitcoin miners. Here’s the potential impact of this trend on the cryptocurrency.
Recent Decline in Bitcoin Miners’ Activity
A recent update from the analytics platform IntoTheBlock highlights a notable decrease in the Bitcoin Miners’ Volume Share. This term refers to an on-chain metric that monitors the proportion of the total Bitcoin transaction activity (the volume of BTC involved in transactions on the network) attributed to miners.
The following chart illustrates the trend of Bitcoin Miners’ Volume Share over the last ten years.
The graph indicates that the Bitcoin Miners’ Volume Share exceeded 20% during last year’s first-quarter rally. This likely points to miners engaging in significant transactions on the blockchain to capitalize on the price increase.
However, since reaching that peak, the metric has seen a downturn. A brief spike occurred toward the end of last year when Bitcoin experienced another rally, indicating that miners might have engaged in profit-taking. The quick sell-off could suggest that miners had limited coins available for sale. Alternatively, it may indicate a rise in overall network activity, leading to a reduction in miner-associated transaction volume.
This decline mirrors patterns seen in previous bullish market phases, reinforcing the idea that increased transaction activity from fresh capital during such times contributes to this trend.
Furthermore, it is noteworthy that each subsequent peak of this metric has diminished over past cycles. This reduction may result from the block subsidy—essentially the reward miners receive for successfully adding blocks—which gets halved during periodic Halving events. Consequently, with lower earnings, miners have less capacity to engage in transactions, impacting their volume share.
Currently, Bitcoin Miners’ Volume Share has dropped below the 5% threshold, falling beneath the lowest point recorded during the 2017 cycle. However, it has not yet reached the lows seen during the 2021 bull market.
Current Bitcoin Pricing
In the last 24 hours, Bitcoin has experienced an additional loss of 2%, bringing its price down to approximately $93,700.