According to the data from btc.com, a Bitcoin mining performance tracking firm, the mining difficulties have surged by 4.89%. The Popular cryptocurrency reporter Wu blockchain has also reported about the rising difficulties of Bitcoin miners by 5%. Even though the mining activities have grown rapidly along with the surge in production price, which pumped up the capital, the mining revenue is declining significantly.
Whereas the market traded between a weekly high of $31,900 and a low of $27,395. This is recorded as the first sign of a green market after a long red market, continuous doubt and stress in the market have led to reliance on Long-term Holders further.
Further, the report of Glassnote says that the Bitcoin miner’s revenue has continued to drop, the production cost surges, and market condition stays bearish and long-term holders suffer losses. The Glassnode has estimated the value of the market from a miner’s viewpoint, with the help of a market matric called the Puell Multiple. The Puell Multiple valuations calculate the ratio of the daily issuance value of bitcoin (in USD) to the 365-day moving average of this value.
The capitulation could take place, as the Puell Multiple plunges to the sub-0.5 zone, at the later stage of a drawn bear market. This metric currently holds at 0.66, a crucial point that could lead to a capitulation range.
” According to the analysis done by Glassnode, miner balances are reducing and miners are spending extra, the Miner Net Position Changes currently indicate an aggregate miner balance reduction between 5k and 8k BTC monthly.”
This reports the changes in miners’ behavior, where the balance had seen a buildup of around 12k BTC during the first drawdown from ATH. Since Luna LFG sold over 80k BTC, the BTC miners have been adding to BTC selling pressure.
“Mining is now more expensive, rewards offered in USD continue to drop and may lead to a potential miner capitulation cycle ahead. There is reason to believe that the market is within the second and final capitulation phase of a Bitcoin bear market.”
Despite the massive revenue stress, the new miners have joined the network and the existing ones have widened their operations. Whereas the money spent on the mining hardware and facilities may stress the balance sheet of miners even more.