Bitcoin price falls below $59,000 amidst signs of miner capitulation
Bitcoin’s recent decline below $59,000 is indicative of significant selling pressure, as analysts at QCP observe potential miner capitulation as a signal of a market bottom. The leading cryptocurrency, Bitcoin (BTC), is grappling with another day of robust selling activity, breaching the critical $60,000 support level and reaching lows of $57,875, reflecting a notable downturn as BTC struggles to stabilize amidst market volatility. QCP analysts, in their latest research briefing, point out that Bitcoin miners are displaying signs of “capitulation,” a historical signal often linked with a price floor.
The analysts noted, “Historically this has been associated with a bottom in prices with the last comparable hash rate drawdown occurring in 2022 when BTC traded to $17,000.” Despite the widespread crypto market sell-off, the analysts highlight that the options market maintains an optimistic outlook, with a notable focus on Ethereum call options for September and December expiries, signaling bullish sentiment towards ETH even amid BTC’s challenges.
QCP analysts have identified various factors that could potentially reverse the current downward trend. Both Bitcoin and Ethereum exhibit significant liquidation clusters on the upside, which could trigger short squeezes and propel prices upwards. Another potential catalyst is the anticipated approval of S-1 forms, which could lead to a substantial bounce in ETH prices. As reported by crypto.news, cryptocurrency liquidations have more than doubled in the past day, resulting in global market capitalization hitting a two-month low. Coinglass data reveals a 114% surge in total crypto liquidations over the last 24 hours, amounting to $265 million.
In a recent exclusive interview with crypto.news, Julio Moreno, the head of research at CryptoQuant, highlighted the possibility of witnessing miner capitulation if prices fail to recover significantly during the summer. Moreno emphasized that the hashprice, representing the average miner revenue per hash, continues to hit new lows post the latest halving event.
The market dynamics surrounding Bitcoin and Ethereum continue to evolve amid ongoing price fluctuations and market uncertainties. The crypto landscape remains fluid, with various indicators and factors influencing investor sentiment and market behavior. As the crypto market navigates through these challenging times, stakeholders closely monitor key developments and trends to gauge potential opportunities and risks in the ever-evolving digital asset space.
