2024

Bitcoin

when

<ul> 
 <li aria-level="1">Bitcoin miners face increased sell-off due to reduced profitability, exacerbating the ongoing market price decline.</li> 
 <li aria-level="1">CryptoQuant CEO highlights persistent miner capitulation; daily mined value remains high compared to historical averages.</li> 
</ul> 
Amid the turbulence of the cryptocurrency markets, Bitcoin miners are grappling with increasing challenges that could have broader implications for the sector. 
Recent developments have highlighted ongoing miner capitulation, a phenomenon that underscores current market pressures and may point to future trends in Bitcoin’s trading environment. 
Miner capitulation occurs when declining Bitcoin prices reduce <a href="https://www.ethnews.com/the-role-of-bitcoin-halving-in-shaping-mining-profitability-and-crypto-market/">mining profitability</a>, compelling miners to sell their holdings to sustain operations. This sell-off can exacerbate price declines, creating a cycle that impacts the broader market.&nbsp; 
<blockquote class="twitter-tweet" data-width="550" data-dnt="true"> 
 <a href="https://twitter.com/hashtag/Bitcoin?src=hash&amp;ref_src=twsrc%5Etfw">#Bitcoin</a> miner capitulation is still ongoing. 
 Historically, it ends when the daily average mined value is 40% of the yearly average; it's now at 72%. 
 Expect the crypto markets to be boring for the next 2-3 months. Stay long-term bullish but avoid excessive risk. <a href="https://t.co/OCsiI57KPo">pic.twitter.com/OCsiI57KPo</a> 
 — Ki Young Ju (@ki_young_ju) <a href="https://twitter.com/ki_young_ju/status/1810713273995555259?ref_src=twsrc%5Etfw">July 9, 2024</a>
</blockquote> 
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script> 
CryptoQuant CEO Ki Young Ju notes that this phase is ongoing, with the daily average mined value significantly higher than historical cessation points. According to Ju: 
<blockquote>
 “Bitcoin miner capitulation typically ends when the daily average mined value is 40% of the yearly average; currently, it stands at 72%.”
</blockquote> 
This situation suggests that the market could remain subdued in the coming months. Ju advises a conservative approach to trading during this period, recommending maintaining a long-term positive outlook while being wary of short-term risks. 
<figure id="attachment_81320" aria-describedby="caption-attachment-81320" style="width: 100%" class="wp-caption aligncenter">
 <img decoding="async" class="size-full wp-image-81320" src="https://www.ethnews.com/wp-content/uploads/2024/07/CryptoQuant-miner-capitulation.png" alt="CryptoQuant-miner-capitulation" width="804" height="478">
 <figcaption id="caption-attachment-81320" class="wp-caption-text">
 Source: CryptoQuant
 </figcaption>
</figure> 
Furthermore, the Bitcoin network’s total computational power, or <a href="https://www.ethnews.com/adapting-bitcoin-mining-new-tech-and-market-prices-influence-hashrate/">hashrate</a>, has seen a noticeable decline, falling to 540 exahashes per second from a peak of 751 EH/s recorded in April. This decline is indicative of miners shutting down their operations, a direct consequence of reduced profitability and heightened financial strain. 
<figure id="attachment_81324" aria-describedby="caption-attachment-81324" style="width: 100%" class="wp-caption aligncenter">
 <img decoding="async" class="size-full wp-image-81324" src="https://www.ethnews.com/wp-content/uploads/2024/07/coinwarz-Bitcoin-fundamentals-signal-market-stress.png" alt="coinwarz-Bitcoin-fundamentals-signal-market-stress" width="2035" height="1308">
 <figcaption id="caption-attachment-81324" class="wp-caption-text">
 Source: CoinWarz
 </figcaption>
</figure> 
Transaction activity among major Bitcoin holders, or whales, also reflects the market’s current volatility. Data from IntoTheBlock shows a decrease in the number of transactions exceeding $100,000, which has dropped alongside fluctuating Bitcoin prices. 
<figure id="attachment_81328" aria-describedby="caption-attachment-81328" style="width: 100%" class="wp-caption aligncenter">
 <img decoding="async" class="size-full wp-image-81328" src="https://www.ethnews.com/wp-content/uploads/2024/07/hashrate-bitcoin.jpg" alt="hashrate-bitcoin" width="1199" height="668">
 <figcaption id="caption-attachment-81328" class="wp-caption-text">
 Source: CryptoQuant
 </figcaption>
</figure> 
 This reduction from over 17,000 transactions in late June to 15,330 transactions highlights a cautious sentiment prevailing among significant investors. 
<figure id="attachment_81332" aria-describedby="caption-attachment-81332" style="width: 100%" class="wp-caption aligncenter">
 <img decoding="async" class="size-full wp-image-81332" src="https://www.ethnews.com/wp-content/uploads/2024/07/ITB_btc_number_of_large_transactions_bitcoin_2024-07-10T08.png" alt="ITB_btc_number_of_large_transactions_bitcoin_2024-07-10T08" width="1200" height="800">
 <figcaption id="caption-attachment-81332" class="wp-caption-text">
 Source: IntoTheBlock
 </figcaption>
</figure> 
Despite these challenges, there remains a non-negligible chance of Bitcoin achieving new highs. ETHNews <a style="color: #339966;" href="https://www.ethnews.com/bitcoin-mining-difficulty-soars-to-ath-halving-sentiment-boosts-confidence-in-btc-price/">reports</a> a 25% probability that Bitcoin could reach a new all-time high within the year, suggesting that underlying confidence in the asset’s value remains, despite current market difficulties. 
The post <a href="https://www.ethnews.com/bitcoins-profitability-woes-miners-face-harsh-realities-as-prices-fluctuate/">Bitcoin’s Profitability Woes: Miners Face Harsh Realities as Prices Fluctuate</a> appeared first on <a href="https://www.ethnews.com">ETHNews</a>.

Bitcoin’s Profitability Woes: Miners Face Harsh Realities as Prices Fluctuate

ETHNews

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