Despite Bitcoin (BTC) remaining relatively suppressed over the past month – trading between $60,000 to $65,000 – BTC miners aren’t really selling the premier cryptocurrency. That said, overall weakness on miners’ side continues, evident in the form of tumbling revenue.
Bitcoin miners see tumbling revenue
Three key mining-based indicators – such as the Miner’s Position Index (MPI), Puell Multiple, and BTC miners’ reserve – when analyzed together, show that despite the lower than usual revenues, BTC miners are sticking with their digital asset holdings.
For the uninitiated, MPI measures how much Bitcoin miners are sending to exchanges relative to their historical behavior, with a high MPI suggesting stronger potential selling pressure and a low or negative MPI suggesting miners are holding rather than selling.
Similarly, the Puell Multiple compares miners’ current daily Bitcoin revenue to its historical average, with low readings indicating weak miner profitability and high readings indicating stronger revenue conditions.
As of Wednesday, the MPI is hovering below 0. Although the MPI has been quite volatile over the past few days, its current level suggests that there is no clear miner driven selling activity.
Meanwhile, the Puell Multiple being below 1 indicates that BTC miners’ revenues firmly remain below their historical average. In other words, revenue conditions are not particularly strong for the mining sector – which could increase the economic pressure on mining firms in the short-term.
That said, BTC miners not dumping their holdings despite the low-revenue environment is a positive sign. As a result, rather than acting as a direct sell signal for Bitcoin’s price, the Puell Multiple currently indicates weak revenue conditions for miners.
Keep an eye on MPI
Recently, the Binance Pool Miner Reserve has fallen from roughly 41,924 BTC to 41,902 BTC.
Although a decline in reserves alone does not necessarily mean that miners are selling, the fact that the MPI is simultaneously at -0.03 suggests that this decline is not being accompanied by aggressive selling to exchanges.
Concluding, the current structure of the chart can be interpreted as neutral to slightly positive for BTC price. In particular, the fact that the MPI remains below 0 indicates that there is no strong downside pressure on Bitcoin coming from miners.
