"Pressure mounts on bitcoin mining industry…difficulty drops 14% and Cango sells 4,451 BTC"
Summary
- The 14% drop in bitcoin network difficulty and the Puell Multiple falling below 0.8 were interpreted as signs of structural pressure across the mining industry and “miner capitulation.”
- Listed miner Cango sold 4,451 BTC for about $305 million, after which its shares fell 8%, underscoring growing market pressure from the decision to strengthen its financial structure.
- If bitcoin holds $70,000, hashrate could recover and miner capitulation may be nearing an end, while a drop below $65,000 could trigger further mining shutdowns and asset sales, the report said.
Forecast Trend Report by Period
As bitcoin (BTC) mining conditions deteriorate sharply, an analysis says structural pressure is building across the mining industry.
According to Axel Adler Jr. on the 10th, bitcoin network difficulty has fallen about 14% over the past three weeks, marking the largest adjustment in the current cycle. This is being read as a typical sign of a “miner capitulation” phase, in which unprofitable mining rigs exit the network.
The “Puell Multiple,” a gauge of mining profitability, has dropped below 0.8. This indicates miners’ revenue has fallen well below the annual average. It was seen dipping into the 0.6 range at the short-term low.
Against this backdrop, listed miner Cango sold 4,451 BTC over the weekend for about $305 million. The company said the move was aimed at strengthening its financial structure, but Cango shares fell about 8% in a single day after the news.
Still, miners’ flows into exchanges remain relatively stable. Total miner exchange inflows (30-day average) are running at about 82 BTC per day, with no clear signs yet of a sharp increase in selling or panic-driven supply.
Axel Adler Jr. said that “the current stress in the mining industry is being relieved through a decline in hashrate rather than large-scale coin selling,” adding that while “selective selling by some companies is emerging, it is too early to view it as a system-wide panic signal.”
In the market, some analysts say that if bitcoin holds around $70,000 and hashrate rebounds at the next difficulty adjustment, the miner capitulation phase could move into its final stage. Conversely, if the price falls back below $65,000, analysts say the possibility of additional mining shutdowns and asset sales cannot be ruled out.
Minseung Kang
minriver@bloomingbit.ioBlockchain journalist | Writer of Trade Now & Altcoin Now, must-read content for investors.
