Miners are still facing the worst of the crypto market’s turmoil, with profits down by 80% from top levels. In the wake of mounting capitulation pressure, the Poolin multi-asset mining platform recorded the single largest miner outflow from wallets in 2-years, involving 10,000 Bitcoins.
Poolin, a popular mining pool, reportedly witnessed the large outflow, which reports indicate might have been a way for its miners to either move the funds to other wallets, fund day-to-day costs or cover energy costs associated with running a BTC-mining operation.
The outflow comes amidst increasing mining difficulty, declining Bitcoin prices, and several miners closing their businesses due to the dropping profitability of the mining business.
The Bitcoin Total Transfer Volume from Miners, a metric that shows the amount of BTC sent by miners to different wallets and exchanges, rose sharply to a 2-year high after Poolin’s 10 BTC outflow. Here is the chart derived from Glassnode of Bitcoin’s latest Total Transfer Volumes.
Despite previous weeks recording the highest miner capitulation, the above data does not necessarily reflect miner selling but could interpret as miners moving their coins to other wallets.
BTC miner outflows going to cryptocurrency exchanges
Bitcoin miners’ actions have usually reflected the sentiments of the overall cryptocurrency market since much of the selling occurs as miners protect themselves from losses due to plummeting prices.
However, the above metric fails to clarify whether the coins have been sent to exchanges for fast liquidation or wallets for custodial storage. The good news is there was another metric to gauge the amount of BTC miner outflows going to cryptocurrency exchanges.
According to data from November, transfer volumes to exchanges hit the highest on Nov.26 at 650 BTC. The sudden increase in transfer volumes to exchanges showed when Bitcoin’s market became vulnerable. However, the volumes have since fallen and are lying below the 50BTC level per day.