- Despite BTC's recent poor price performance, miners have not yet capitulated.
- However, they continued to take profits.
In a current one reportnoted the pseudonymous CryptoQuant analyst Yonsei Dent that despite Bitcoins [BTC] Price drop following Exchange Traded Fund (ETF) approval, miner capitulation has yet to begin.
Dent took into account BTC's Hash Ribbon metric – which identifies market trends and miner behavior by tracking hash rate moving averages (30DMA and 60DMA) – and found that the indicator was strong despite the poor performance of the Coin has not signaled a death cross since the introduction of ETFs.
A death cross occurs when Hash Ribbon's short-term moving average (30DMA) falls below its longer-term moving average (60DMA). This indicates a decline in miner activity and indicates that miner profitability may be low.
Additionally, Dent assessed BTC's Miner's Position Index (MPI) and found that miner capitulation in the current market does not appear to be occurring at the levels seen at previous bear market lows. BTC's MPI measures the historical pattern of miners' selling behavior during market downturns.
According to Dent:
“If we examine miners’ capitulation sales at an MPI index of 4.0 during previous bear market bottoms and bottoms, it is clear that this adjustment does not mean the occurrence of miners’ capitulation.”
No capitulation yet, but the miners have sold some coins
As Dent pointed out, “miners sold significant amounts of BTC in January 2024.” The analyst noted that this could be a “proactive move to prepare for future halving events.”
According to data from CryptoQuant, BTC miner reserve, measured at a 30DMA, has declined by 1% year-to-date. This metric measures the amount of coins held in the wallets of connected miners. Its decline often indicates an increase in coin sales among network miners.
Source: CryptoQuant
Likewise, the coin’s miner-to-exchange flow measured during the same period recorded a growth of 45%. This indicator measures the amount of BTC flowing from miners to exchanges.
Read Bitcoins [BTC] Price prediction 2024-25
When it rises, it means miners are selling more BTC than they are mining for profit.
At press time, BTC is still facing significant resistance at the $43,000 price level and is trading at $42,085. According to data from CoinMarketCapthe coin's value has increased by 5% in the last week.
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