Miners Are the New Whales: Here’s How to Decode Their Moves

• Miner holdings declines and reduced exchange supply drive Bitcoin price upward trends.
• Social volume spikes around Bitcoin mining often coincide with high price volatility.
• Dogecoin miner supply recovery in 2024 shows inverse relationship with price movements.

Crypto traders have long focused on the actions of whales when trying to understand market moves, but according to analytics firm Santiment, there is a growing interest in tracking total miner balances as a powerful signal for potential market changes.

As trading strategies become more sophisticated, paying attention to miner holdings offers fresh insights on price action, volatility, and market sentiment.

Miner Holdings vs. Exchange Supply

The total amount of Bitcoin (BTC) and Dogecoin (DOGE) held by miners has proven to be a valuable tool in predicting their respective market trends.

One key takeaway was the connection between the supply held by miners and the supply on exchanges. Over time, we have seen the amount of Bitcoin available on exchanges go down, and the amount held by miners has also dipped slightly. This trend started in early 2021 and is still going, which suggests a potential shift in the market.

Big price jumps often happen when the supply on exchanges drops, especially from mid-2020 to early 2021. So, when there’s less Bitcoin available on exchanges, the price tends to rise due to scarcity, making it even more important to keep an eye on miner activity.

The Role of Social Sentiment in Price Movements

Besides looking at miner and exchange balances, traders are also tuning into social sentiment. Data suggests that online discussions about Bitcoin miners often peak during times of price volatility. A recent look at Bitcoin’s price and social volume between March 2024 and September 2024 highlights this pattern.

When social media buzz on Bitcoin mining picks up, Bitcoin’s price tends to make big moves, which points to a possible link between market sentiment and price behavior. So, monitoring social platforms could be a smart way to anticipate future price changes.

Dogecoin Miners and Price Volatility

The relationship between miner-held supply and price is not just limited to Bitcoin. Dogecoin (DOGE) has shown a similar pattern over the past year. In late 2023, the supply held by Dogecoin miners declined sharply but gradually recovered in 2024. 

Read also: Analyst: Dogecoin’s Reign as Meme Coin King is Ending

Interestingly, we saw big swings in Dogecoin’s price, with a sharp rise in early 2024. But by mid-2024, as miners held onto their DOGE, the prices started to fall. This could mean a few things – maybe miners were selling, or perhaps demand just wasn’t there.

At press time, Bitcoin’s live price stands at $60,332.42, with a 24-hour trading volume of $39.57 billion. Additionally, Bitcoin has gained 3.44% in the last 24 hours. Meanwhile, Dogecoin’s live price is $0.100548, with a 24-hour trading volume of $498.5 million. Dogecoin has risen 0.25% in the past 24 hours.