Bitcoin‘s value is on the rise, edging close to the $45,000 mark, buoyed by a significant drop in selling by miners and an uptick in accumulation by large investors. The cryptocurrency’s surge is partly attributed to mining firms, especially in the U.S., opting to stockpile Bitcoin rather than sell it, despite a sharp decrease in their profits. CryptoQuant, a blockchain analytics firm, has noted that the miners are facing revenue deficits yet are choosing to keep their Bitcoin, signaling a strategic shift in their approach to holding digital assets.
Changes in Bitcoin Network Activity
The Bitcoin network has seen a remarkable contraction in transactions, diving from a peak to a three-month low, primarily due to less activity involving inscriptions and BRC-20 token transactions. The use of taproot addresses, in particular, has plummeted, resulting in a drastic 90% reduction in transaction fees since mid-December.
Whale Behavior Signals Market Confidence
‘Whales’, or large-scale investors, are showing increased confidence in Bitcoin, as reflected by substantial acquisitions of the cryptocurrency. LookOnChain, another on-chain data provider, has highlighted substantial transfers of Bitcoin from Binance, coinciding with the latest increase in Bitcoin’s price.
The combination of reduced miner sales and aggressive buying by wealthy investors has propelled Bitcoin towards the significant price point of $45,000. This cryptocurrency has witnessed over a 3% increase in value recently, with PlanB, a prominent Bitcoin analyst, signaling this surge as potentially indicative of an emerging bull market based on the current trading trend above historically realized prices.