Bitcoin BTC
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The price of fell below $43,000 as the digital asset faced downward pressure from miners selling their reserves on the market.
“Much of the Bitcoin price decline, especially following the SEC’s approval of the spot Bitcoin ETF, can be attributed to selling by Bitcoin miners who used BTC’s rally as a catalyst to liquidate or leverage their positions.” Bitfinex analysts said in a report Tuesday.
The report notes that miners are motivated to sell in preparation for the upcoming halving this year, which will reduce Bitcoin rewards and thus reduce business profitability.
“Selling now provides miners with capital to upgrade their infrastructure and is a reminder that miners have significant influence over market liquidity and price discovery,” Bitfinex analysts added.
According to reports, shortly after the approval of the spot Bitcoin ETF, Bitcoin miner holdings decreased significantly. “Last week saw the largest ever outflow from miner wallets, and more sales may be imminent,” the report added.
Upcoming Bitcoin Halving
The next Bitcoin halving is likely to occur in April of this year, and this event will result in a 50% reduction in the rewards miners receive for validating and adding new blocks to the blockchain.
Halving occurs approximately every four years, or after 210,000 blocks have been mined. The last halving occurred in 2024, reducing the block reward from 12.5 Bitcoin to 6.25 Bitcoin.
The next halving will occur after approximately 840,000 blocks have been mined, which will further reduce the block reward from the current 6.25 BTC to 3.125 BTC per block. This mechanism is programmed into the Bitcoin protocol and is intended to control the supply of new Bitcoins, increasing the scarcity of Bitcoins over time.
The world’s largest cryptocurrency by market capitalization fell more than 1% over the past 24 hours to $42,920 at 8:34 a.m. ET, according to The Block’s pricing page.
Bitcoin price fell more than 1% on Tuesday. Image: Block.
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