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Bitcoin ETFs Trigger Record Miner BTC Outflows

The launch of Bitcoin exchange-traded funds (ETFs) in the United States has led to significant outflows of Bitcoin from miner wallets to exchanges, with over $1 billion moved in the first 48 hours of trading. This trend is attributed to various factors, including operational liquidity needs.

The introduction of Bitcoin exchange-traded funds (ETFs) in the United States has had a direct impact on miners' Bitcoin reserves, resulting in over $1 billion of BTC flowing from miner wallets to exchanges within the first 48 hours of trading.

On January 12, the second day of Bitcoin ETF trading, miner outflows to exchanges surged, marking a six-year high, with more than $1 billion in Bitcoin sent from miner-associated wallets to exchanges. Another substantial outflow of 13,500 BTC from miner wallets to exchanges occurred on February 1.

However, around 10,000 BTC returned to miner wallets on February 2, possibly reflecting specific mining companies' wallet rebalancing.

Data reflecting Bitcoin flows from miner wallets has generally been negative since the approval of Bitcoin ETFs in the United States. CryptoQuant data estimates net outflows from miners at approximately 10,200 BTC.

Several factors contribute to these outflows, including the need for operational liquidity among miners, varying responses to market conditions, and adjustments following the approval of Bitcoin ETFs. Some miners may have also aimed to capitalize on the price surge weeks before the ETFs received approval.

While miners have moved Bitcoin from their wallets following Bitcoin ETF approvals, on-chain data indicates that long-term Bitcoin investors are holding onto their assets and are hesitant to sell at current market prices.

The report highlights a decrease in supply last active within the one-year and two-year time horizons, specifically related to the Grayscale Bitcoin Trust, where dormant BTC holdings have been sold or swapped into other Bitcoin ETFs.

Overall, the movement of older Bitcoin supply serves as an important market indicator, reflecting changing sentiments and strategies of investors in response to Bitcoin ETFs and current market conditions. Most of the Bitcoin supply remains tightly held, with long-term investors demonstrating their belief in Bitcoin's future appreciation.