The price of the flagship cryptocurrency Bitcoin ($BTC) has struggled to surpass the $60,000 mark after it started recovering from a low under the $50,000 mark earlier this month, but its dominance of the space is growing, which could lead to a “violent” crash.
According to popular cryptocurrency analyst Mikybull Crypto, Bitcoin’s share of the total cryptocurrency market could lead to a “violent” crash, according to a post the analyst shared with their over 70,000 followers on the microblogging platform X.
The prediction came after the analyst pointed out that the TD Sequential indicator, a popular tool among traders and analysts for identifying potential buy or sell signals in the market, formed a top signal for Bitcoin’s dominance.
Here is further data on the Bitcoin dominance cycle top confirmation.The crash down will be as violent as it was after the cycle bottom signal.#Altcoins https://t.co/Wjj8hS2oDR pic.twitter.com/qessQyQI92
— Mikybull 🐂Crypto (@MikybullCrypto) August 12, 2024
Developed by Tom DeMark, the indicator is designed to forecast the timing of price points where a trend could exhaust itself and reverse. It does this through a series of numbers (sequentials) plotted on price charts, which are based on specific criteria related to the closing price of an asset over a set number of periods.
The price prediction comes after Bitcoin miners has significantly reduced their BTC reserves over the last few months, to the point they’re not at their lowest level since January 2021, when the cryptocurrency’s price exploded from around $25,000 to over $69,000 before entering a downturn.
The total amount of Bitcoin held by miners has plummeted to a three-year low as a direct consequence of the recent halving upgrade in April, which halved the coinbase reward miners receive per new block found.
According to a report from Bloomberg citing Kaiko data, the amount of Bitcoin held by miners has dropped to around 1.5 million BTC, worth around $86 billion. Miners have notably seen selling tokens since the cryptocurrency market rallied in late 2023, with the proceeds from these sales often being used to fund their operations.
Data from cryptocurrency analytics firm CryptoQuant confirms there has been a severe downtrend in miner reserves, with its data pointing to reserves of around 1.8 million BTC.
Featured image via Unsplash.
