decline of up to 40% is an indicator for capitulating miners. The hash rate lags price — if Bitcoin moved to $100K tomorrow, many more miners would want to join. But they first need to purchase hardware and get their rigs online, which is why the hash rate tops after the price did.
Bitcoin Magazine quotes Charles Edwards, founder of quantitative asset management firm Capriole Investments: “Given the magnitude of the supply controlled by miners, and the general level of high efficiency in their businesses, when miners are selling the worst has often occurred. As a result, price and hash rate recovery out of this miner capitulation has historically marked major price bottoms.”
Miners that don't want to stay in the game go offline. Those that do sell BTC inventory to stay afloat. An indicator of this is the. In simple terms, if the Hash Ribbon inverts , miners are capitulating and going offline. Edwards considers miners less important than they used to be because other whales have appeared. Still, he sees their capitulation as a“My general view is that the next six to 12 months will provide the best opportunity to get into bitcoin over the next five-plus years.
Bitcoin has rallied over 30% since touching lows of $18K in mid-June 2022. But was that the bottom or merely a relief rally? 🫢