On-chain data shows the OTC desks that Bitcoin miners like to use have seen their balance shoot up, a sign that historically been bearish.
Bitcoin Miners Have Been Depositing Big To OTC Desks Recently
As pointed out by an analyst in a CryptoQuant Quicktake post, BTC miners have been sending coins to over-the-counter (OTC) desks during the past three months.
OTC desks are platforms that facilitate a direct transaction between individuals or institutions. Such selling and buying is more discreet than it is on centralized exchanges, so it can be hard to track who is trading on these platforms.
The analytics firm CryptoQuant, however, has used on-chain data to identify certain addresses that are likely to be associated with OTC desks that miners like to use.
These are the wallets that miners often transfer to and considering that miners generally move coins out of their reserve for selling, it would make sense the addresses that they send to would be connected to the sales somehow.
Below is a chart that shows the trend in the balance of these probable miner “OTC desks” over the past decade.
As displayed in the above graph, the miner OTC desk balance had been at relatively low values earlier in the year, even after the cryptocurrency had rallied to its new all-time high (ATH).
In the consolidation period that has followed since this ATH, however, miners have made significant transfers into these addresses. As the quant notes,
Bitcoin OTC desk balances for miners have increased by more than 70% over the past three months, rising from 215,000 BTC in June to 368,000 BTC in August—an increase of 153,000 BTC.
The metric hasn’t been at such a high level since way back in June 2022. Considering these large deposits, it would seem like miners have been eager to move on their coins recently.
In the chart, the analyst has highlighted what happened in previous periods where the miner OTC desk balance observed a similar trajectory. It would appear that such a pattern has historically led to a decline for the BTC price.
As for why miners have shifted such a large amount of coins to these platforms, the answer may lie in an event that occurred back in April of this year: the fourth Halving.
Halvings are periodic events taking place approximately every four years that permanently cut the Bitcoin block subsidy in half. Miners make the majority of their income from the block subsidy, so it’s obvious how these events can affect their finances.
Miners initially held off on transferring to these platforms after this event, but that may be because of the fact that the atmosphere in the market was still bullish. As the consolidation lengthened, though, the miners may not have been able to cope with the pressure anymore, so they decided to sell.
Given what has historically occurred when this pattern has taken shape, it’s possible that BTC may end up feeling a similar bearish effect this time as well.
BTC Price
At the time of writing, Bitcoin is floating around $61,300, up more than 4% over the last seven days.
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