- Several indications of capitulation were pointed out by CryptoQuant experts.
- Miners have been “extremely underpaid” for the most of the time after the halving.
Bitcoin miner capitulation gauges are getting close to the market bottom after the FTX crisis in late 2022, suggesting a potential bottom for BTC, according to market intelligence company CryptoQuant.
As a means of survival or “earn yield or hedge their Bitcoin exposure,” some miners may cut down on operations or sell off part of their mined Bitcoin and reserves, a practice known as “miner capitulation.”
Struggle of Miners Continue
Several indications of capitulation were pointed out by CryptoQuant experts over the last month. When the price of Bitcoin fell 13%, from $68,791 to $59,603.
The fact that Bitcoin’s hashrate, which is the overall computing power used to secure the Bitcoin network, has dropped significantly from its record high on April 27 to a four-month low of 576 EH/s, a drop of 7.7 percent, is one such indicator.
It is worth mentioning that the 7.7 percent downturn is reminiscent of a similar drop in hashrate that occurred in late 202. When the price of Bitcoin hit a low of $15,500 before seeing a 15-month surge of almost 300 percent.
According to the CryptoQuant analysis, miners have been “extremely underpaid” for the most of the time after the halving. This is supported by the miner profit/loss sustainability index. Therefore, daily income for Bitcoin miners have dropped 63% since the halving. When transaction fees and basic block rewards were greater.
As a result of falling profits, Bitcoin miners are putting their savings into yield. The daily volume of miner withdrawals has jumped to its highest level since May 21, according to CryptoQuant, which might mean that miners are dumping their Bitcoin holdings.
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