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Bitcoin Plummets While Miners Continue to Hold Ground

bitcoin miners

TL;DR

  • Despite the decline in Bitcoin miners’ revenues, there are no signs of capitulation, according to CryptoQuant’s Ki Young Ji.
  • The mining industry faces the dilemma of surrendering or waiting for a BTC price increase to cover their costs.
  • If the bearish trend in BTC prices persists for an extended period, it could lead to a massive sell-off.

Despite the decline in Bitcoin miners’ revenues since the halving, there are no signs of capitulation, according to CryptoQuant CEO Ki Young Ji. The mining industry faces the dilemma of capitulating or waiting for a BTC price increase to cover their costs.

Ki Young Ji’s analysis is based on the Puell Multiple indicator, which suggests that miners are not showing signs of giving up, despite their revenues hitting 14-month lows. This situation occurs despite Bitcoin prices experiencing a significant correction from their all-time highs, increasing pressure on miners. According to Coinmarketcap, BTC is trading just above $57,000, far from its recent ATH reached in March, when it surged to $73,750.

Additionally, the decline in miners’ revenues coincides with a decrease in demand for Bitcoin-based assets, affecting their profits doubly. Although revenues increased immediately after the halving, the recent plunge in BTC and cryptocurrency prices overall has raised concerns about the fate of miners.

bitcoin mineria

More Pressure and Risk of Massive Bitcoin Liquidations

The risk of miner capitulation will increase if the bearish trend in BTC prices persists for an extended period. This could lead to a massive sell-off of BTC by miners to cover their costs, exerting additional downward pressure on its price.

Furthermore, the decrease in BTC’s hash rate indicates a decline in mining activity, a sign of financial difficulties for miners. The hash rate has dropped to a historic low of $46.55, representing a 74% decrease from its post-halving peak.

Despite the resilience, the situation remains delicate, and it is important to closely monitor how BTC prices evolve in the coming days and weeks.

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