Bitcoin: Does miner capitulation finally have an end date in place
Bitcoin miners saw some relief as miners’ balance hit a four-year high on Glassnode. Well, for one, the recovery over the BTC market could have helped the same. But could August bring more relief given the past relationship between miners and the crypto?
To repair the past
Miner capitulation remains a key indicator in determining whether or not conditions will improve. Miner capitulations are when a significant net % of miners shut down machines over an extended period of time. Cryptocurrency mining firm Blockware has now published its latest Intelligence Newsletter on July 29 to showcase the same.
Looking at the hashrate metrics, the current miner capitulation episode began on June 7th. It obviously lasted a considerable amount of time. According to Blockware, the capitulation, as defined by hash bands, should be over as soon as the market recovers.
Source: Glassnode
The Bitcoin Hash Ribbon indicator tries to identify periods where Bitcoin miners are in distress and may capitulate. Hash bands take 30-day and 60-day moving averages of the Bitcoin hash rate, which are used to determine when sufficient miner capitulation has occurred.
The company wrote,
“Since June 7, other new generation mining rigs have been connected by both public and private mining companies. However, enough old generation machines or inefficient over-leveraged miners have shut down that hashrate and difficulty have actually decreased in size.”
Now the market seems to recover after Bitcoin increased to $23k. Furthermore, the network could see some relief when the newsletter added,
“If there are no new lows in Bitcoin, we should expect the miner capitulation to end in August or September at the latest.”
In addition to this, mining difficulties for the first increase in two months on August 4th after three straight downgrades in a row. Mainly because the network is over halfway through this era of hardship. “Currently, it is projected to be positive and is highly likely to persist,” the blog claimed.
Take responsibility here
Data from blockchain analytics platform CryptoQuant also indicated an increase in the accumulation of Bitcoin block rewards, pointing to a possible end to the current downtrend in digital assets. Here, block reward refers to the incentive crypto miners receive for successfully mining a block of crypto assets.
Source: CryptoQuant
The aforementioned graph emphasized that consumers were hoarding the asset and a bull run could be just around the corner. To further support this narrative, Ki Young Ju, CEO of CryptoQuant, t00 repeated the same accumulation phase narrative.
The last one #Bitcoin the accumulation phase was in mid-2020, and lasted 6 months.
As of May 2022, to me, it’s pretty obvious that $BTC is in an accumulation phase. Institutions riding the 2021 bull run also bought in this $25-30k range.
Why not buy? Serious question.
— Ki Young Ju (@ki_young_ju) 29 May 2022
