Bitcoin Miners Showing Signs of Capitulation

Bitcoin (BTC) miners are displaying signs of capitulation, a phenomenon often associated with market bottoms. After enduring a 13% downturn in the past 30 days, the world’s largest cryptocurrency, Bitcoin, is currently trading at $60,300. Despite a 3% slide on Wednesday, this level has been a crucial support since April, with Bitcoin rebounding three times from this area before aiming back towards the $70,000 mark.

Data provider CryptoQuant suggests that capitulation may be on the horizon, as several indicators point to this following a period of significant selling pressure. Two key signs of miner capitulation are a decline in hashrate and mining revenue by hash (hashprice), both of which have seen notable drops this month. Hashrate, which represents the mining power in the Bitcoin network, has fallen by 7.7% since the halving, while hashprice is approaching all-time lows.

Miners have also experienced a significant decrease in daily revenue, plummeting from $79 million on March 6 to $29 million today. As a result, miners are shutting down equipment, leading to a decline in hashrate.

“Miners are facing a 63% reduction in daily revenues due to the halving and the sharp drop in transaction fees to 3.2% of total revenue,” stated CryptoQuant in a recent report.

The current levels of miner capitulation are reminiscent of those seen in December 2022, which marked the market bottom following the collapse of FTX.