Bitcoin (BTC) has recently experienced a significant correction, with prices dropping below the $42,000 support level, causing widespread fear, uncertainty, and doubt (FUD) in the market. This correction has not only sent shockwaves through the holder community but has also significantly impacted Bitcoin miners.
In the past 24 hours, BTC miners have faced financial difficulties as transaction fees hit their lowest since June 2022, adding a new layer of complexity. The reduced rewards increase financial pressure on miners, potentially leading to increased selling pressure from them, which could further drive the price of Bitcoin down and amplify the ongoing market correction. In contrast, institutional players are strategically accumulating BTC.
Bitcoin ETF issuers, excluding Grayscale, have collected a significant amount of BTC at an average price of $42,000, reflecting a substantial investment of $3.63 billion. This strategic accumulation by institutions underscores a long-term perspective and continued confidence in Bitcoin’s future value. However, it also suggests potential short-term impacts and further centralization of BTC ownership.
There has been a decrease in the total number of BTC holding addresses, indicating a potential contraction in overall market participation. Additionally, a decrease in the long/short ratio, with new addresses outnumbering old ones, could signal a shift in market sentiment. Amid these developments, an increase in daily active Bitcoin network addresses has emerged as a positive sign, providing some stability and potentially mitigating the effects of other negative factors.