While bitcoin (BTC) looks set to continue on its upward trend, bitcoin miners have increased their sales.
The Miner's Rolling Inventory
During this recovery phase, miners sold more coins than they generated, according to the Miner's Rolling Inventory (MRI) scheme, a measure created by the crypto data company ByteTree to track changes in inventory levels held by miners.
Over the past 21 days, MRI has remained above 100 during the entire duration of the recent recovery. An MRI greater than 100 indicates that miners are selling more than they extract and are running out of inventory, while an MRI reading less than 100 indicates that miners are accumulating inventory by selling less than they extract.
Mining pools represent the highest percentage of bitcoin that flows in exchanges like Bitcoin system and have a significant influence on prices. Some view the current market reaction as a positive indicator.
"When the price of bitcoin manages to rise sharply from historic lows and buyers can take advantage of the extra bitcoins sold by miners without creating a negative impact, it is a sign of strength in the global market," says Connor Abendschein, an analyst in crypto research at Digital Assets Data.
The miners released the inventory Wednesday, as noted by ByteTree founder and president Charlie Morris. “The miners sold 2.788 BTC against 1.588 BTC mined, challenging the market, and the market accepted the challenge.
This is a bullish dynamic, "tweeted Morris during Wednesday's European trading hours. Other analysts, however, are of the opinion that the one-day changes in miners' net sales are often too small to make a sound assessment of the market hike.
"Wednesday's sales volume of 2.788 was not statistically significant to get a fair idea of the major movements in bitcoin prices." said Alexander S. Blum, COO of the fintech Two Prime company.
"Compared to the amount of Bitcoin in the world, miners' sales were less than 1%." Unfortunately, the cryptocurrency remains vulnerable due to the tendency of traditional markets to avoid risky assets. Global equities have regained some balance over the past two days, mainly due to the massive fiscal and monetary stimulus from the United States.
Crisis from covid-19
The coronavirus epidemic, however, shows no signs of slowing down and markets have yet to have a clear view of the economic damage that is being created, which could be much larger than widely expected.
For example, initial jobless claims in the United States rose by over three million in the week ending March 21, doubling economists' expectations by 1,5 million.
"If you think what's going on now is the economic crisis, you're wrong," tweeted the famous gold bug (and skeptical crypto) Peter Schiff. “This is the health crisis. The economic crisis is what will come when the fiscal and monetary situation has to be settled. This crisis will not only be worse than the great recession, but the great depression ".