Bitcoin miners have sent over $1 billion worth of the asset to crypto exchanges over the past two weeks, but not necessarily to sell the tokens. According to analytics firm CryptoQuant, 33,860 BTC has been sent to derivatives exchanges, although the majority has since been recovered back to proprietary wallets. Miners have also reduced their reserve holdings by 8,000 BTC, with only a small portion sent to spot trading exchanges.
This could signal that miners may be using their newly minted coins as collateral in derivatives trading activities, CryptoQuant analysts said. A good example of this type of trading is known as ‘hedging’, which uses bets in the opposite direction to market consensus.
The surge in Bitcoin miners sending BTC to exchanges comes as the asset has risen nearly 20% in the past two weeks, due to favorable catalysts such as spot Bitcoin ETF filings by traditional finance companies and increased trading interest. On-chain metrics have previously suggested Bitcoin could already be in the early stages of a bull market, meaning Bitcoin-based businesses, such as miners, could already be taking steps to manage their reserves and holdings.
In the past few days, $128 million worth of Bitcoin rewards have been sent to crypto exchanges, an amount estimated to total 315% of daily mining revenues, according to on-chain analytics firm Glassnode. This is the largest-ever sent amount on record by this metric. Similar amounts sent to exchanges have previously caused a reversal in price spikes if buyer demand isn’t able to absorb the sales.