The number of addresses with at least 1 Bitcoin hit a new high. The influence of miners on the price of coins is gradually weakening.

According to data from the indicator and analysis website Glassnode, the number of addresses holding at least one Bitcoin has reached an all-time high. Today, the price of Bitcoin also hit a new high since January 2018, reaching $15,700, or about RMB 102,800.

As of today, there are 824,193 Bitcoin addresses holding at least one Bitcoin. This exceeds the previous all-time high of 824,160 addresses observed on September 17, 2020.

The number of addresses holding at least one Bitcoin has been climbing steadily since Bitcoin was created in 2008 — even though the price of Bitcoin has risen significantly since then.

Bitcoin price logarithmic rainbow predicts that the post-halving rally may have just begun

But the new record could have something to do with the price of Bitcoin, which has risen by about $4,000 in the past month alone and by about $11,000 since the coronavirus-induced market crash in mid-March. Likewise, the high price of Bitcoin could make the current price base more solid and more profitable in the future, as owning a Bitcoin is relatively expensive at the moment.

Why is the price of Bitcoin rising?

The new crown pandemic, the US election, fiscal easing, any one of these factors may be right - 2020 is the year of the black swan, and the price of Bitcoin has also stood out from many assets.

According to Glassnode, the 16% drop in Bitcoin mining difficulty is the second-largest adjustment ever - the previous record was set in October 2011, when it dropped 18%. This is due to the seasonal relocation of miners from China , where the peak-to-trough transition mainly occurs .

It’s not just Bitcoin. Glassnode also recently reported that the number of Ethereum addresses holding more than 100 ETH (about $4,000) has reached an all-time high of 53,019. This broke the previous record of 52,943 set on July 13 this year.

On-chain metrics suggest Bitcoin miners’ influence on price is weakening

A new report from on-chain analytics provider CoinMetrics suggests that the considerable influence of miners on the Bitcoin network is fading. Bitcoin miners are holding less assets and may be starting to switch from a bearish hoarding strategy to selling Bitcoin for a healthy profit due to the recent very healthy market.

The study analyzed miners and their addresses and spending to determine whether their impact on the network as a whole has changed over time. Since miners receive newly issued bitcoins rather than buying them on the secondary market, they are naturally net sellers of the asset. The recent difficulty adjustment and hash rate drop is also considered the largest downward difficulty adjustment in the ASIC mining era.

Measuring the net flows from two types of addresses associated with block rewards shows that miners’ impact on liquidity has gradually decreased:

“On-chain metrics such as miner holdings and net transfers suggest that miners’ influence on the network is gradually diminishing.”

Operating costs such as electricity and rent are denominated in fiat currency, which increases the pressure to sell BTC for fiat currency. The study found that miners generally hold less Bitcoin over time.

Addresses that received block rewards, as well as addresses that received instant transactions from them, are seeing a decline in the number of tokens they hold.

From the perspective of total supply, the gradual reduction in the supply held by miners and mining pools is more obvious. That being said, the report confirms that miners and mining pools still control a "significant portion" of the total supply. In particular, large miners who were active in the early days of the network control a large amount of BTC.

However, the amount of Bitcoin held by miners has generally declined throughout the network’s history.

Data shows that the percentage of total supply held by mining pool addresses and miner addresses has dropped from about 25% in 2015 to about 18% today. Less holding means that miners can dump less BTC into the market, reducing their impact on prices.

In the early days of the network, net flows were volatile as both the number of BTC sales and the price changed dramatically. However, volatility has gradually decreased over time, likely due to the halving event and the reduction in block rewards. These flows have also experienced a gradual decrease in volatility, indicating that miners have a decreasing influence on liquidity.