Bitcoin mines ‘capitulation event’ may have already happened – Research

by · July 6, 2022

Bitcoin (BTC) miners may have already triggered a “capitulation event,” recent analysis has concluded.

In an update on June 24, Julio Moreno, senior analyst at the on-chain computer company CryptoQuant, suggested that the bottom of the BTC price may now be due.

The BTC price base “usually” follows miner’s capitulation

Miners have seen a dramatic change in circumstances since March 2020, from unparalleled profitability to seeing their margins put under pressure.

The fall to $ 17,600 – 70% below November’s all-time highs for BTC / USD – has hit some players hard, data now shows, with miners’ wallets sending large amounts of coins to exchanges.

This, CryptoQuant suggests, precedes the final stages of Bitcoin sales more broadly in line with historical precedent.

“Our data shows a mining capitulation event that has occurred, which has typically gone before market bottoms in previous cycles,” Moreno summed up.

Sales of miners have been closely followed this month, with the Bitcoin Twitter account even describing the situation as miners “being drained of their coins.”

“For miners, it’s time to decide to stay or leave,” CryptoQuant CEO Ki Young Ju said. added in a Twitter thread last week.

The situation is difficult, but the majority of miners remain active, as evidenced by basic networks that fall just short of all-time highs of over 30 trillion.

Basic overview of the Bitcoin network (screenshot). Source: BTC.com

Mixed signals over buyer interest

When it comes to other large BTC holders, the picture is less clear.

Related: “Foolish” to deny Bitcoin price can go below $ 10K – Analysis

After whales bought up liquidity close to 19,000 dollars, CryptoQuant’s Ki announced this week the arrival of “new” large volume units.

Outflows from major US stock exchanges Coinbase, he noted, reached its highest since 2013.

Trader and analyst Rekt Capital nevertheless repeated doubts about the strength of the total buyer volume, and claimed that sellers, conversely, still controlled market movements.

Bitcoin’s 200-week moving average (MA), a major support level under previous bear markets, has not yet seen significant interest from buyers despite the spot price being around $ 2000 below it.

“The current BTC buying volume after the extreme sales volume spike is still lower than the 2018 Bear Market buyer follow-up volume at 200-week MA. Let alone March 2020 follow-up on the buying side,” he told Twitter followers.

BTC / USD annotated chart. Source: Rekt Capital / Twitter

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