Miner Capitulation Signals Renewed Bitcoin Momentum, Vaneck Says
Over the last 30 days, the Bitcoin network's hashrate has declined at the steepest rate since April 2024. This negative 90-day hashrate growth has historically been followed by positive 180-day Bitcoin returns about 77% of the time. Such a decline in mining activity, referred to as miner capitulation, is viewed as a contrarian signal indicating improving price momentum.
Bitcoin currently trades around $87,000, following a 36% peak-to-trough drop from its all-time high in October. Historically, hashrate declines tend to lag behind price drops and have more often signaled markets approaching cyclical bottoms rather than tops.
As higher-cost miners exit the network, mining difficulty adjusts downward while block production remains steady. This reduction in difficulty improves mining profitability and eases future selling pressure. The current shutdowns are primarily concentrated among higher-cost or geopolitically exposed mining operations.
Investors buying Bitcoin during periods of sustained hashrate corrections may see improvements in 180-day forward returns by approximately 2,400 basis points (24 percentage points). Additionally, Bitcoin halving events, which occur roughly every four years, reduce new Bitcoin issuance by about 50%, further influencing mining economics and profitability.
