BTC Miner Capitulation Looms Amid Price Slump and Halving: Expert Analysis

IconCryptoNewsTerminal Staff05 Jul, 2024

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BTC Miner Capitulation Looms Amid Price Slump and Halving: Expert Analysis

BTC Miner Capitulation Nears as Halving, Price Drop Bite A recent report by CryptoQuant suggests that Bitcoin (BTC) miners are edging closer to a capitulation event as the asset's price continues its rapid decline. The report highlights that the Bitcoin Miner Capitulation Index has reached a level akin to that witnessed during the FTX collapse in late 2022. A miner capitulation could potentially signal the bottom for BTC. Indicators Point to Potential Miner Capitulation One key indicator of miner capitulation, the BTC hashrate, has plummeted by 7.7% since reaching an all-time high on April 27th, marking a four-month low. This decline mirrors conditions seen in late 2022, which preceded a remarkable 1,550% rally in Bitcoin over 15 months after its drop to $15,500. Profit Margins Squeeze Miners Since the recent halving, miners have grappled with exceptionally low profitability. This has resulted in a 63% reduction in daily miner revenue compared to pre-halving levels. Miner Outflows Rise, but Stay in Check Notably, miner outflows have increased over the past month. However, these outflows have not reached extreme levels (defined as surpassing 2x the one-year average).

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