Bitcoin (BTC) Miners Are Expanding Their Capacity Again as Network Hashrate Reached a Fresh All-Time High This Week: CryptoQuant

Such expansion comes despite a recent drop in bitcoin (BTC) prices, indicating positive sentiment among miners after a bout of selling in the past few months.

Bitcoin (BTC) price dropped below $60,000 on Tuesday after posting record highs above $62,000 last week. However, on-chain metrics suggest that the recent selling may be nearing exhaustion, hinting at a possible bottom in sight.

Bitcoin Price Analysis One of the key on-chain metrics that have been closely followed by analysts throughout 2023 is the miner capitulation. As prices rallied sharply in the first half of the year, a massive chunk of the selling pressure came from bitcoin miners.

Now, as prices attempt to find a bottom after the recent sell-off, another round of miner capitulation may be setting the stage for a local bottom. On August 5, bitcoin daily miner outflows spiked to 19,000 BTC, the highest since March 18.

Bitcoin daily miner outflows hit a yearly high on August 5. Source: CryptoQuant This recent spike in miner outflows comes after bitcoin prices dropped below $50,000 on August 2.たちもまた関心を持っている。

According to on-chain data analysis firm CryptoQuant, bitcoin network hashrate reached a fresh all-time high on Tuesday.

This expansion in bitcoin mining capacity comes despite a recent drop in BTC prices and record-low hash price, indicating positive sentiment among miners after a bout of selling in the past few months.

Bitcoin hashrate reached a new record of 627 exahash per second on Tuesday, recovering from the 8.5% drawdown in early July. Such expansion comes despite a recent drop in bitcoin prices and record-low hash price – or the average revenue per amount of mining power – indicating positive sentiment among miners after a bout of heavy selling in the past few months.

Hashrate refers to the computational power used by miners to mint new bitcoin and verify new transactions on the Bitcoin network. Millions of calculations are solved each second to ‘win’ new blocks, in a process broadly called mining.

“We may have seen a miner capitulation event last week as miner outflows spiked after prices touched $49,000,” CryptoQuant said in a report with CoinDesk on Wednesday.

Bitcoin price dropped to $48,893 on August 2 before rebounding to above $50,000. Afterwards, BTC prices largely consolidated within the $52,000-$56,000 range.

Bitcoin price dropped sharply on August 2, and then began consolidating within the $52,000-$56,000 range. Source: TradingView A miner capitulation event is typically seen near local bottoms for Bitcoin prices during bull markets.

Since 2023, a spike in miner outflows coincided with local bottoms in March 2023 after the Silicon Valley bank sell-off – and January 2024, the price correction following the bitcoin spot ETF launch in the U.S.

Miners are entities that supply computing power to any blockchain network in return for “rewards” in the form of BTC tokens. They typically sell bitcoin to keep operations afloat continually as running such systems is costly: Only five popular mining rigs were profitable in early July as prices floated around the $54,000 mark.

“Miners sold some Bitcoin as their average operating profit margins were squeezed to 25%, the lowest since January 22,” the firm added.

Bitcoin price trades at $60,663 in Asian afternoon hours on Wednesday, up 2.2% in the past 24 hours to lead gains among major cryptocurrencies.

Edited by Cheang Ming

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