CoinMetrics: Miners’ influence on Bitcoin’s secondary market is declining

According to Chain News, CoinMetrics has recently released a report on miners' on-chain data, using a new method to view the addresses of transfers in on-chain transactions, thereby quantifying miners' holdings and transfer activities. CoinMetrics said that in the process of Bitcoin mining, since the mining pool will initially receive block rewards and then distribute them to miners. Therefore, the address of the first transfer (0-hop) usually represents the mining pool, while the address of the second transfer (1-hop) represents the miner. Although miners are still important to the Bitcoin network, it can be seen from the gradually declining net flow of the second transfer address that their influence on the secondary market is smaller than before. The report pointed out that in the history of Bitcoin mining, the number of Bitcoins owned by the first transfer address and the second transfer address has generally declined. However, this trend has reversed significantly in the second half of 2019 and the first half of 2020. Before the halving, miners accumulated 383,000 BTC from the bottom to the peak. This impact is mainly reflected in the second transfer address, while the holdings of the first transfer address remain roughly unchanged. The report also pointed out that most of the inflows to the first transfer address are miners' income. Although the income will change in the short term due to fluctuations in fees and the number of mined blocks, it is relatively stable. Relatively speaking, outflows are more unstable because miners can choose when to withdraw their income from the mining pool wallet. However, since the halving in 2020, the value of inflows to the first transfer address has exceeded the value of outflows, which is a reversal of historical norms.