Story from Markets Outflow of Bitcoin From Miners at Lows Not Seen Since 2010

Miner outflows of bitcoin have dropped to decade lows, with analysts suggesting a hoarding mentality is partly responsible.

The seven-day average of the total amount of bitcoin transferred out of miners' addresses declined to 987 on Thursday, hitting the lowest level since Feb. 3, 2010, according to data source Glassnode. The previous decade low of 988 was registered on May 23.

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Source: Glassnode
The number of coins being sent by miners to exchanges is also at its lowest point in over a year, as noted by Glassnode in its weekly report.

"It is a sign of efficient miners continuing to hoard (only selling a proportion of BTC)," said Asim Ahmad, co-chief investment officer at London-based Eterna Capital.

The increase in miner holding does not necessarily have long-term bullish implications for the cryptocurrency's price. Miners tend to operate mainly on cash and liquidate their holdings almost on a daily basis to fund operations.

As such, miner hoarding could be termed as temporary deferral of BTC sales, possibly due to fears that the market lacks the strength to absorb the regular amount of supply. Essentially, they may be waiting for the market to show strength and prices to rise before realizing their profits.

The market, therefore, could face an above-normal miner supply during the next meaningful price rise. That, in turn, could put the brakes on a price rally.

Hoarding aside, the other main reason for the decline in outflows is the reduction in bitcoin being mined since May's reward halving, said Ahmad.

Indeed, transfer volume from miner addresses fell from 2,334 BTC to 1,034 BTC in the nine days following the May 11 reward halving, which reduced the per block emission by 50% to 6.25 BTC.

That sharp decline in profitability forced out less inefficient miners, as evidenced by a drop in the seven-day average of the hash rate – the total computing power dedicated to mining blocks on the blockchain. That fell from 120 tera hashes per second (TH/s) to 90 TH/s in the two weeks following halving (though it's since climbed as more efficient machines were switched on).

Forced out miners, however, may return to bitcoin's blockchain if prices rise sharply, making older hardware once again profitable.

Bitcoin is currently trading largely unchanged on the day near $9,370, according to CoinDesk's Bitcoin Price Index.

The cryptocurrency has been largely restricted to a narrow range of $9,000 to $10,000 since mid May. The direction in which the range is breached will likely set the tone for the next big move. 

New York Times blockchain has a long way to go

The New York Times believed that blockchain technology could serve as a solution to fight fake news and disinformation. They admired that a public blockchain could serve as a shared source of truth and that could be referenced if there was a piece of news or a photograph, whose origin or legitimacy was questionable.

In July 2019, The New York Times unveiled News Provenance Project—an initiative that used blockchain to fight misinformation. However, after a year of research and development, the News Provenance Project team admits that they are still very far away from having a fully functional product that is ready for the world.

"This prototype was an experiment that taught us a lot about the power of credible, contextual information in social media feeds, but there is a long way to go before something like this can be fully realized," said Pooja Reddy, a product manager at The New York Times.

Although the team at the New York Times was able to make advances when it comes to using a blockchain to fight misinformation, by the end of their first run, the team ended up far from the finish line.

News Provenance Project
In its initial phase, The New York Times blockchain focused on photography. The blockchain was able to track a photo from the time it was captured, to the time it was edited, to the time that it was published. The metadata of the photo was stored on their blockchain and could be shared across the blockchain network's members who they envisioned would be news publications and social media platforms.

After conducting research interviews, the NYT team learned that individuals who were interested in verifying this sort of data were looking to see, who took the photo, where it was taken, how many changes/edits were made to the photo, and where the photo had been published. Although the New York Times R&D team was able to create a blockchain that did that successfully, the NYT team still felt as though they had missed the mark, or were far away from the goal line.

The obstacle
The New York Times research and development team found that there needed to be a better, easier way to check the photos that appear on social media against the photos on the blockchain.
"Bhaskar Ghosh, a student at Columbia University who conducted research for the News Provenance Project, investigated perceptual hashing and computer vision as potential mechanisms for associating photos on social media with photos on the blockchain. However, Ghosh noted that those mechanisms would require further refinement," according to the New York Times blog post. For blockchain to be used across both news publications and social media networks to battle misinformation when it comes to photographs, improvements need to be made that make it easier for all parties involved to use the blockchain to verify the data they are seeing.

For the next phase of the News Provenance Project, the NYT is looking for collaborators to build standards, rating systems, and enable detection of misinformation. If you believe you assist the News Provenance Project in that regard, you should head over newsprovenanceproject.com to learn more.