Table of ContentsToggle
As the cryptocurrency community braces for the upcoming Bitcoin halving, scheduled for April 20th, analysts warn of a potential downturn in prices as miners gear up to liquidate a significant portion of their holdings. Markus Thielen, the head of research at 10x Research, has raised alarm bells, suggesting that historical trends indicate a sizable outflow of Bitcoin from miners post-halving, which could lead to a prolonged period of market stagnation.
Miners Could Dump $5 Billion in BTC After the Bitcoin Halving
According to Thielen’s calculations, Bitcoin miners could offload as much as $5 billion worth of BTC in the months following the halving event. This anticipated sell-off, he argues, could exert downward pressure on prices, echoing patterns observed in previous halving cycles. Thielen predicts a “four to six-month summer lull” in the cryptocurrency markets, with Bitcoin likely to trade sideways during this period.
The phenomenon of miners liquidating their holdings after the halving is not new. In the wake of the 2020 halving, Bitcoin prices remained range-bound for five months, fluctuating between $9,000 and $11,500. Thielen suggests that history may repeat itself, with Bitcoin struggling to gain significant upward momentum until around October.
#Bitcoin Might Trade Sideways for 6 months As Miners Could Sell $5bn of BTC -> Here is why: https://t.co/gLRgs8yyGg pic.twitter.com/zBLdV95MAl — 10x Research (@10x_Research) April 13, 2024
However, the lead-up to the halving typically witnesses a surge in Bitcoin prices, driven by miners stockpiling BTC to hedge against potential revenue declines post-halving. Indeed, Bitcoin prices soared by 74% in 2024, reaching an all-time high of $73,734 on March 14th, before undergoing a correction to below $63,000 in mid-April.
Thielen’s concerns extend beyond Bitcoin to altcoins, which he believes could suffer disproportionately from the impending sell-off. Many altcoins have already experienced significant declines in recent weeks, with some still far below their 2021 peaks. Despite speculation about a potential altcoin rally correlated with the halving, Thielen argues that historical evidence suggests any such rally would likely occur six months later.
Marathon’s Approach
Highlighting the strategies of major miners like Marathon, Thielen emphasizes the likelihood of a gradual liquidation of BTC holdings to avoid revenue cliffs. Marathon, the world’s largest Bitcoin miner, has reportedly accumulated a substantial inventory that it plans to sell gradually post-halving. With Marathon currently producing 28-30 BTC per day, Thielen estimates that the additional supply hitting the market could total 133 days, compounded by the BTC it continues to produce post-halving.
This strategy, Thielen warns, could result in a daily selling pressure of up to $104 million worth of BTC, potentially reversing the supply-demand dynamics that fueled the pre-halving rally. Marathon CEO Peter Thiel recently indicated that the firm’s break-even rate post-halving would be around $46,000 per BTC, suggesting that significant price movements are unlikely in the six months following the event.
As the cryptocurrency community eagerly anticipates the Bitcoin halving, Thielen’s analysis serves as a sobering reminder of the potential challenges ahead. With miners poised to liquidate significant BTC holdings, investors may need to brace themselves for a prolonged period of market uncertainty and volatility.
Opmerkingen