Bitcoin at a Crossroads – Miners Surrender as Market Stabilizes

• Bitcoin price was trading near the $59,000 range at the time of writing.
• There seems to be some surrender on the part of the miners, but the big miners are still collecting.

Bitcoin experienced a major capitulation from miners last week as its price dropped, leading to increased outflows from miners. This came alongside a spike in mining difficulty, which reached its highest level in years and put additional pressure on miners. However, recent metrics suggest that this capitulation may be coming to an end as Bitcoin has shown signs of stabilizing somewhat.

Bitcoin Miners Surrender

Crypto QuantData revealed that Bitcoin saw a massive capitulation from miners last week as its price dropped to the $49,000 range. On August 5, daily mining inflows surged to 19,000 BTC, the highest level since March 18.

The sales come as mining companies face increasingly tight profit margins, with margins falling to 25%, their lowest since January 22.

Source: CryptoQuant

The analysis also noted that some miners sold parts of their reserves, racking up a loss of $22 million — the largest daily loss since May 29. The sharp spike in hashrate and network difficulty led to this wave of surrender.

Metrics have reached new record highs over the past week, putting additional pressure on mining operations. These difficult conditions have forced miners to liquidate their holdings to cover costs, highlighting the pressures they have faced during this period.

Current status of miners’ property

But that’s not all. Smaller mining companies’ holdings have hit record lows due to the recent capitulation in the Bitcoin market.

Miner Balance by Cohort data reveals that even before this latest capitulation, smaller miners (pink line) were seeing a steady decline in their Bitcoin holdings — a trend that intensified after the halving event in Q2.

Source: CryptoQuant

Conversely, larger miners have been increasing their holdings. According to the above analysis, larger miners (purple line) have continued to accumulate Bitcoin, with their total holdings now standing at 66,000 Bitcoin.

This accumulation by larger miners has contributed to a general decline in Bitcoin surrender, especially as the price of Bitcoin is experiencing a slight recovery.

Resistance at $60k despite recent gains

Since Bitcoin broke below its short-term and long-term moving averages (yellow and blue lines), the $60,000 price range has been an important resistance level. Bitcoin’s daily chart analysis indicates that the yellow line is providing resistance around $61,000, while the blue line is another resistance point around $62,000.

At the time of writing, Bitcoin saw a more than 2% increase in the last trading session, closing above $58,000.

While this recovery does not represent a return to previous highs yet, it does represent a positive move up from the recent low of $49,000, which led to miners capitulating.

Source: TradingView

– Read Bitcoin (BTC) price prediction 2024-2025

Although it is still shy of breaking the crucial resistance level at $60,000, this rise could hasten a gradual recovery.

However, Bitcoin must overcome these key resistance levels to regain stronger upward momentum and approach its previous highs.