As the next Bitcoin halving event looms, analysts predict a significant shift in the bitcoin market. Markus Thielen, head of research at 10x Research, suggests that Bitcoin miners could offload approximately $5 billion worth of BTC in the months following the halving. This anticipated sell-off mirrors past trends and could result in a prolonged period of stable bitcoin prices.
Markus Thielen Anticipates a Sell-Off
Thielen’s analysis indicates that Bitcoin miners have historically accumulated BTC leading up to halving events, disrupting the balance between supply and demand and subsequently pushing prices upwards. However, once the halving occurs, miners may begin selling off their inventory to avoid revenue drops.
Thielen remarks:
“The overhang from this selling could last four to six months, explaining why Bitcoin might go sideways for the next few months — as it has done following past halvings.
Miners tend to accumulate BTC, “leading to a supply/demand imbalance and a subsequent rally in Bitcoin prices,” especially in the period preceding the halving event.
Thielen’s analysis suggests Marathon, the top Bitcoin miner, might flood the market with 133 days’ worth of supply after halving, plus their daily 14-15 BTC. If others do the same, Thielen predicts “this could result in a maximum of $104 million of BTC selling per day – reversing the supply/demand imbalance that caused BTC to rally pre-halving.”
Similar Trends from the Past
Drawing parallels with previous halving cycles, Thielen highlights the five-month period following the 2020 halving, during which bitcoin prices remained range-bound between $9,000 and $11,500. This suggests a potential “summer lull” in the bitcoin market, delaying any “significant challenge” until several months after the halving.
Mining Giants and Their Strategies
Marathon, the world’s largest Bitcoin miner, is expected to adopt a strategy of gradually offloading its inventory post-halving to remain profitable. Thielen estimates that Marathon’s daily BTC production, combined with its pre-halving inventory, could result in a significant daily influx of BTC into the market.
Matthew Kimmell, a digital asset analyst at CoinShares, comments:
“This is the final push for miners to squeeze out as much revenue as they can before their production takes a big hit, with revenues across the board decreasing overnight, the strategic response of each miner, and how they adapt, could well determine who comes out ahead and who gets left behind.”
If other miners follow suit, Thielen warns that the market could see up to $104 million worth of bitcoin being sold each day post-halving, potentially reversing the supply-demand imbalance that fueled the recent price rally.
While Thielen’s analysis primarily focuses on Bitcoin, there are varying opinions regarding the impact of the halving on the broader digital asset market. Some experts, like Marathon CEO Fred Thiel, have limited expectations for significant price movements in the months following the event.
Conclusion
As the Bitcoin market braces for the upcoming halving event, all eyes are on Bitcoin miners and their potential sell-off of BTC. Analysts warn of a prolonged period of sideways movement in Bitcoin prices, with altcoins likely to bear the brunt of the situation. However, amidst the uncertainty, there remains optimism about the long-term prospects of Bitcoin and the role of ETFs in shaping market dynamics post-halving.
