Bitcoin miner ‘capitulation event’ may have already happened — research

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Bitcoin (BTC) miners have already started a “capitalization event”, the latest analysis concludes.

In an update on June 24, Julio Moreno, senior analyst at on-chain data firm Crypto Quant, indicated that the BTC price may now turn lower.

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Miners have seen a dramatic change in circumstances since March 2020, which is going to see their margins squeezed by unprecedented profitability.

Data now shows that BTC/USD’s drop from November’s all-time high of $17,600 – up to 70% – has hit some players hard, with miners sending large amounts of coins to wallet exchanges.

This, suggests Cryptoquant, precedes the final phase of selling bitcoin more broadly, in line with historical precedent.

“Our data demonstrates a minor capitulation event, which has typically preceded market lows in previous cycles,” Moreno summarized.

Miner sales this month have received a lot of attention, with the @Bitcoin Twitter account even describing the situation as miners “being taken out of their coins.”

“For miners, it is time to decide whether to stay or leave,” said Cryptoquant CEO, Ki Young Joo, couple In a Twitter thread last week.

The situation is tough, but most miners remain active, as seen by Network Fundamentals, falling only slightly from an all-time high of over 30 trillion.

Bitcoin network fundamentals overview (screenshot). Source: BTC.com

Mixed signals on buyer interest

However, when it comes to other large BTC holders, the picture appears less clear.

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The cryptocurrency’s key this week heralded the arrival of a “new” large volume of entities, after whales bought liquidity near $19,000.

He added that outflows from the major United States exchange Coinbase have reached their highest level since 2013.

Trader and analyst Rect Capital nonetheless reiterated doubts about the strength of overall buyer volume, arguing that sellers on the contrary were still directing market movements.

Bitcoin’s 200-week moving average (MA), a key support level during the past bear markets, is yet to receive significant interest from buyers, while the spot price is trading below it at around $2,000.

“Current BTC buy-side volume is still below the 2018 bear market buyer follow-through volume levels at the 200-Week MA after the massive sell-off. Let alone March 2020 buy-side follow-through,” he Told Twitter followers.

BTC/USD Annotated Chart. Source: Rect Capital/Twitter

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