Although cryptocurrencies made a significant leap in the first quarter of this year, they steadily declined for the rest of the year. Except for a few outliers, we saw that most altcoins experienced stable losses. While the increase in BTC price did not support the majority of altcoins, the downturns managed to pull them all down. This seems to be the most challenging aspect of bear markets.
Bitcoin Cash (BCH)
One of the altcoins that stood out positively in the second half of this year was BCH Coin. While the EDX news supported its price, BTC sales limited new highs. Last week, the price, which could not exceed $250, experienced double-digit losses. Bitcoin miners and crypto whales are taking opposite positions, and it seems likely that BCH price will show excessive volatility.
The June rally of 150% was a rare movement and pushed the BCH price above $300, setting a yearly high. BCH, which became one of the most profitable altcoins of the year, is now returning part of the gains.
Why Did BCH Coin Fall?
While some investors benefited from evaluating support levels and making short-term gains, there was a group that also took advantage of these movements. They were BCH miners, of course. On-chain data reveals how BCH miners used the rally to liquidate their reserve block rewards worth millions.
The price reaching $329 on June 30, 2023, excited whales and individual investors. However, despite the support of these two groups, BCH Coin could not reach new highs. The reason for this was the miners’ desire to empty their reserves consisting of block rewards.
If we carefully examine the IntoTheBlock chart, we can see how the cumulative balance of miners melted between June 19 and October 9, when the rise began. While miners held 8.37 million balance at the start of the major rally, they now hold 5.76 million BCH.
Miner reserves reached the lowest level in the past 5 years. Moreover, the price movement between October 1 and 5 was dominated by miners. The price, which fell due to miner sales at $250, is now at around $216.
Considering what happened at the beginning of October, miner sales can continue. This shows that the possibility of bulls surpassing resistance levels is gradually weakening. If miners believe that the negativity in BTC price is intensifying, they can sell at the current price and bring it down to $180.
On the other hand, whales continue to accumulate. With the BCH miner reserves reaching the lowest level in the past 5 years, miners who have enough cash for operational expenses may allow the price to rise. Or an increase in risk appetite among whales may push the price up again.
