Incoming Bitcoin (BTC) Price Dump? On-Chain Data Reveals Bottom
Bitcoin (BTC) price failed to hold above $17k and fell to the support near $16,500 again. The BTC price remains under pressure as the risk of miner capitulation continues to haunt traders looking to take long positions. On-chain data reveals that miners are actually liquidating their Bitcoin holdings due to financial constraints. The effect can easily be seen in the falling share prices of the mining companies.
Miner capitulation risks a sharp drop in Bitcoin price
Crypto mining stocks listed on NASDAQ including Marathon Digital, Core Scientific, Riot Blockchain, Hut 8 Mining, HIVE Blockchain Technologies and Stronghold Digital Mining fell massively in the last 6 months. The situation has worsened this month, with Marathon Digital, Core Scientific and Stronghold Digital Mining falling 46%, 20% and 38% respectively in a month.
Crypto miners have reported poor quarterly results and a reduced number of mined crypto assets. While Bitcoin prices have fallen this year, Bitcoin hash rate, which denotes mining competition, has reached a maximum.
However, hashrate and mining began to fall this month due to a decrease in mining activity. The mining industry is under stress amid depressed coin prices, rising energy costs and debt burdens. Therefore, the financial crisis and falling stock prices will cause companies to eventually go bankrupt, with dumping of Bitcoin as a last resort.
Also, miners’ BTC reserves have decreased by 13K BTC in the last few months. It has now hit a 14-month low of 1,818,280,032 BTC, according to Glassnode.
Millions in BTC Longs liquidated and possible bottom
Bitcoin saw over $15 million in longs liquidated in the last 24 hours, according to Coinglass data. The liquidation of longs caused the BTC price to fall in the last 24 hours, reversing the bullish sentiment at $18K.
On-chain data also suggests that if the BTC price falls below the $16.5k support level, it could hit the $12.8k delta price. According to CoinMarketCap, the Bitcoin price is currently trading at $16,835.
Also Read: Over 10K Bitcoin (BTC) Moved To Crypto Exchange, Are Miners Selling?
The content presented may include the author’s personal opinion and is subject to market conditions. Do market research before investing in cryptocurrencies. The author or publication has no responsibility for your personal financial loss.
