A popular crypto analyst explained how the Bitcoin Price could face additional downside risk due to the current BTC supply distribution around the price.
This Bitcoin Price Range Is a Critical Supply Barrier
In a recent job On Platform X, prominent crypto expert Ali Martinez explained how the price of Bitcoin could see an even bigger drop. The rationale for this bearish projection revolves around the average cost of several BTC investors.
Data from IntoTheBlock shows that around 5.45 million addresses purchased around 3.03 million BTC in a price range between $64,300 and $70,800. As Martinez points out, this has led to the formation of a crucial supply barrier within this price range.
For context, a supply barrier refers to a price range in which a large amount of cryptocurrency has been acquired. Based on the size of the dots in the chart below, it appears that Bitcoin is currently above a significant supply barrier.
A graph showing the distribution of BTC supply around various price ranges | Source: Ali_charts/X
This price range becomes especially relevant when the Bitcoin price falls below this level, as BTC holders within the supply barrier could start selling in order to cut their losses. This could lead to increased selling pressure and a potentially larger price correction for the top cryptocurrency.
Additionally, large-scale load shedding and continued price decline could negatively influence market sentiment, triggering panic selling among other investors. If the selling pressure is significant, this could worsen downward pressure on prices of BTC.
At the time of writing, the Bitcoin price stands at around $64,460, reflecting an increase of just 0.2% over the past 24 hours.
Bitcoin miners capitulate
Typical investors may not be the only class of participants contributing to the selling pressure currently facing the Bitcoin price. The latest on-chain revelation shows that the Bitcoin miners have also been active on the market in recent weeks.
According to data from In the block, Bitcoin miners have offloaded over 30,000 BTC (valued at around $2 billion since June). This represents the fastest rate of decline in BTC miners’ reserves in over a year.
Blockchain analysis attributed this sell-off to miners’ reduced profitability following the recent halving event. THE fourth halving eventoccurring in April 2024, saw the miner’s reward increase 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
