BTC Price Below $59K, As Miner Capitulation Reaches 2022 Levels

Summary

• Bitcoin miner capitulation levels drop close to the ones in 2022 after FTX collapse.
• BTC is now trading below $59,000.

Bitcoin is currently trading below $59,000 after reaching prices above $63,000 at the beginning of July. The coin is now down by over 3% today.

Analysts address more factors that have contributed to this current price correction, and the prolonged miner capitulation event is one of them.

According to data provider CryptoQuant, the miner capitulation comes following an intense period of sell pressure.

For most of the period since April, miners have reportedly been extremely underpaid according to the data provider’s metrics.

The report shows that the total daily revenues for miners have decreased from $79 million on March 6 to $29 million at the time.

CryptoQuant data also reveals that after hitting a record-high hashrate on April 27, the network’s hashrate has experienced a 7.7% drawback and it’s currently getting near a four-month-low.

Spikes in miner outflows show that some of them may be selling their BTC to hedge their exposure.

According to the same data, the miner capitulation levels are now close to the ones at the end of 2022 when the market bottomed following the FTX collapse.

Bitcoin Miners’ Capitulation Event Is Not Over

Bitcoin on-chain analyst Willy Woo also addressed the event via his X account, highlighting the fact that the event is not over yet and he shared a graph showing BTC hash ribbons starting July 2023, to July of this year.

He addressed the fact that miners are “still bleeding out” and the whole event is a culling of weak miners. According to him, you list publicly traded miners who by definition are the stronger ones.

Woo said that their stock price values their future expectation which 100% makes sense because the market expects them to perform better relative to the ones who exit.

According to him, past stock performance does not describe their current selling activities. He cited MARA who has sold 1400 BTC which is their standard policy post halving.

He also said that it should be interesting to see how the best equity beta performs in this cycle.

Other factors that triggered the drop in price for BTC include the liquidation of long contracts as Coinglass data shows, and the repayment to creditors from the Mt. Gox trustee which is slated to release 142,000 BTC to creditors.

Whale activity and macroeconomic factors including inflation and federal interest rates are also contributing to BTC’s price volatility.