A famous crypto analyst explained how the price of Bitcoin could be at risk of further decline based on the current distribution of BTC supply by price.
This Bitcoin Price List Has a Significant Supply Constraint
In a recent post on the X platform, prominent crypto expert Ali Martinez discussed how the price of Bitcoin could suffer. The reason for this bearish speculation revolves around the average cost base of several BTC investors.
Data from IntoTheBlock shows that about 5.45 million addresses bought about 3.03 million BTC within the price range of $64,300 and $70,800. As highlighted by Martinez, this has led to the formation of a significant supply barrier within the price bracket.
In context, the supply constraint refers to the price range at which a large amount of cryptocurrency has been acquired. From the size of the dots in the graph below, it appears that Bitcoin currently has a significant supply barrier above it.
A graph showing the distribution of BTC supply around various price ranges | Source: Ali_charts/X
This price range becomes especially relevant when the price of Bitcoin falls below this level, as BTC holders within the supply barrier may start selling to reduce their losses. This can lead to strong selling pressure and a strong upward price correction of the first cryptocurrency.
In addition, a large decrease in loading and a further decrease in prices may have a negative impact on the market situation, causing panic selling among some investors. If the selling pressure is significant, this may add to the downward pressure on the price of BTC.
As of this writing, the price of Bitcoin is around $64,460, showing just a 0.2% increase in the last 24 hours.
Bitcoin Miners Are Capitulating
Ordinary investors may not be the only class of participants contributing to the selling pressure facing the price of Bitcoin at the moment. The chain’s latest revelation shows that Bitcoin miners have also been active in the market in recent weeks.
According to data from IntoTheBlock, Bitcoin miners have uploaded more than 30,000 BTC (a value of approximately $ 2 billion as of June). This represents the fastest rate of decline in BTC miners’ reserves in over a year.
Blockchain statistics attributed this sell-off to the reduced profits of miners following the recent halving event. The fourth split event, which took place in April 2024, saw the miner’s reward drop from 6.25 BTC to 3.125 BTC.
The price of Bitcoin attempts to cross $65,000 on the daily timeframe | Source: BTCUSDT chart on TradingView
Featured image from iStock, chart from TradingView
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