Bitcoin (BTC) miners appear to be selling large amounts of BTC once again. Data from CryptoQuant shows that the BTC Miners’ Position Index  — a metric tracking the ratio of BTC leaving miners’ wallets — achieved a three-year high. This trend indicates that miners are likely selling BTC on over-the-counter (OTC) or spot exchanges.

Bitcoin Miners’ Position Index. Source: CryptoQuant

On Dec. 10, two large miner-linked Bitcoin transactions were spotted right as the Miner’s Position Index abruptly spiked to levels unseen since 2017, according to data from CryptoQuant.

First, around 800 BTC moved to Binance, which is worth $14.5 million. Second, 11,852 BTC moved to an unknown cold wallet, which is equivalent to $215.9 million.

Bitcoin miner outflows. Source: Ki Young Ju

Not a good short-term signal for Bitcoin

Miners typically sell Bitcoin through spot or OTC exchanges. When a sell-off occurs on spot exchanges, it could intensify the near-term selling pressure on BTC. The impact on BTC price is not as immediately felt when miners sell on OTC exchanges since they are directly selling to buyers.

According to Ki Young Ju, the CEO of CryptoQuant, miners sold “a lot” of Bitcoin on Dec. 10. Although Ki remains optimistic about the price of BTC heading into January, he explained that this is a potentially worrying trend in the foreseeable future. He said:

“Obviously, miners are selling $BTC a lot today. I’m still long, but this is not a good signal in the short-run.”

Other analysts asked Ki whether miners are selling enough Bitcoin to have a considerable effect on the near-term price trend of BTC. In response, Ki noted that albeit the total outflow is not significantly large, the miner outflow is still relatively high compared to the last few days. He added:

“The total outflow is not that big, but it’s relatively increasing compared to past days. Also, the number of outflow txns is unusually high today. The miner-to-exchange flow seems small for now, so I stick to my long. I hope those outflows are OTC deals.”

Miners can place significant selling pressure on Bitcoin especially if large amounts are collectively sold on exchanges. However, in the medium to long term, the accumulation of BTC by institutions could offset the sell-off.

Why this isn’t so concerning in the medium term

In May, Cointelegraph reported that the Grayscale Bitcoin Trust (GBTC) had been accumulating more Bitcoin than mined.

In recent months, Grayscale has continued adding to its reserves to pass $10 billion Assets Under Management. If this trend remains intact, it can help offset the selling pressure from miners and whales in the short to medium terms.