According to crypto analyst Andjela Radmilac, public Bitcoin miners indicate that a second surrender is possible. The analyst notes that the ongoing miner capitulation may continue until the end of the year. Because, the hash rate is expected to increase even more. We have prepared Andjela Radmilac’s analysis for our readers.
Why is it important to monitor the status of Bitcoin miners?
Identifying a market bottom requires a lot of guesswork. Bitcoin’s recent volatility has been driven by a variety of factors, from geopolitical uncertainty and local regulations to the internal explosions of the crypto market. Miners have historically been one of the most reliable indicators of Bitcoin’s performance.
Bitcoin miners form the foundation of the crypto market and create strong resistance levels that reduce volatility. As one of the biggest holders of BTC, it is possible for miners to shake up the market by holding and liquidating their cryptocurrencies. Therefore, analyzing the state of the market requires analyzing the state of Bitcoin miners.
Some of the most robust indicators of miner health have been Hash Ribbons. Hash Ribbons show when miners surrender. It also shows the difference between the 30-day moving average and the 60-day moving average of the Bitcoin hash rate. The surrender of the miners shows that Bitcoin has become too expensive for me. So the market price of Bitcoin is too low to cover the electricity cost to produce it.
According to Hash Ribbons, the worst of miner capitulation usually ends when the 30-day MA of the Bitcoin hash rate rises above the 60-day MA. Since the start of the year, we’ve seen three distinct examples of this transition, highlighted in bold red in the chart below.
The data showed that severe miner capitulation started in mid-June this year and lasted until mid-August. Also, the data is gaining support by surpassing the Hash Ribbons shown in the chart above.
BTC holdings are falling along with miner revenues
The BTC holdings of the top 9 publicly traded Bitcoin mining companies further support this trend. Several major miners put heavy selling pressure between May and June. It liquidated about 8,765 BTC during this period. Selling pressure seems to have stabilized on a monthly basis since June. However, the quarterly data paints a very different picture. The assets of the top 9 public Bitcoin miners fell from 125,171 BTC in the second quarter to 102,407 BTC in the third quarter.
The numbers shown in the chart above fell further in October. Earlier this month, Core Scientific liquidated more than 1,000 BTC it held in September. He also reported that he only had 24 BTC in his possession on October 26.
With mining difficulty and hash rate at an all-time high, miners are stuck in terms of income and resources. The average hash rate is increasing every quarter in 2022. In addition, it will increase at an even higher rate as the fourth quarter ends.
The data shows that Bitcoin’s decline in the second half of the year caused a notable drop in miner revenue.
Bitcoin miner capitulation is likely to continue until the end of the year
Bitcoin’s price volatility, falling revenue and dwindling BTC holdings have also affected the stock market. Shares of all publicly traded Bitcoin mining companies have fallen sharply since the peak in October 2021. Core Scientific takes the lead, with CORZ dropping by almost 90% last year. Argo Blockchain and BitDigital are trailing it with an 88% drop.
cryptocoin.comAs you follow, the hash rate is expected to increase even more. Meanwhile, the end of the bear market is not in sight. Therefore, it is possible that the ongoing miner capitulation will continue until the end of the year. The data shows that miners are exiting the deep red zone and either flattening or consolidating. However, the worse is not over yet. This is likely to create additional selling pressure that will further shake the fragile market.
Contact us to be instantly informed about the last minute developments. twitter‘in, Facebookin and InstagramFollow and Telegram and YouTube join our channel!
Risk Disclosure: The articles and articles on Kriptokoin.com do not constitute investment advice. Bitcoin and cryptocurrencies are high-risk assets, and you should do your due diligence and do your own research before investing in these currencies. You can lose some or all of your money by investing in Bitcoin and cryptocurrencies. Remember that your transfers and transactions are at your own risk and any losses that may occur are your responsibility. Cryptokoin.com does not recommend buying or selling any cryptocurrencies or digital assets, nor is Kriptokoin.com an investment advisor. For this reason, Kriptokoin.com and the authors of the articles on the site cannot be held responsible for your investment decisions. Readers should do their own research before taking any action regarding the company, assets or services in this article.
Disclaimer: Advertisements on Kriptokoin.com are carried out through third-party advertising channels. In addition, Kriptokoin.com also includes sponsored articles and press releases on its site. For this reason, advertising links directed from Kriptokoin.com are on the site completely independent of Kriptokoin.com’s approval, and visits and pop-ups directed by advertising links are the responsibility of the user. The advertisements on Kriptokoin.com and the pages directed by the links in the sponsored articles do not bind Kriptokoin.com in any way.
Warning: Citing the news content of Kriptokoin.com and quoting by giving a link is subject to the permission of Kriptokoin.com. No content on the site can be copied, reproduced or published on any platform without permission. Legal action will be taken against those who use the code, design, text, graphics and all other content of Kriptokoin.com in violation of intellectual property law and relevant legislation.