Bearish signs? BTC’s 2-year highs on Crypto OTC tables could spell trouble for Bitcoin

Cryptocurrency over-the-counter (OTC) desks, which facilitate high-volume transactions between buyers and sellers, currently hold 368,000 bitcoins (BTC), valued at $22 billion at current market prices. This is the highest level seen since June 2022.

A report by chain analyst CryptoQuant revealed that the $22 billion in BTC was driven by a remarkable 70% increase in balances in the past three months. Specifically, the number of bitcoins held in wallets linked to OTC tables rose from 215,000 BTC (about $13 billion) in June to 368,000 BTC ($22 billion) this month, CryptoQuant said. This represents an impressive addition of 153,000 BTC ($9.2 billion) over the three-month period.

Miners are the main contributors

The OTC desk acts as a matchmaker by facilitating high-volume direct transactions between buyers and sellers without involving a public order book. These platforms help large investors place large orders discreetly and fill them without seriously affecting the market.

Among the big investors, miners have been singled out as a major contributor to the growing balance of bitcoins on OTC counters.

CryptoQuant noted that they often turn to OTC offerings to sell their BTC, “seeking better execution without affecting the market price as they would on exchanges.”

The analytics platform added that the notable increase in BTC balances on the OTC table indicates substantial selling activity among miners.

A recurring trend

CryptoQuant noted a recurring trend associated with increasing Bitcoin OTC table balances. According to the report, an increase in Bitcoin OTC desktop holdings often leads to a decrease in the price of the digital asset.

“Historically, increases in OTC Bitcoin desk balances have been associated with declines in Bitcoin prices,” CryptoQuant wrote.

This may not be surprising, as substantial selling by large investors such as miners often leads to short-term price weakness.

At the time of writing, BTC was trading hands at $60,747, a minor increase in the last 24 hours.

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