Miners capitulation looms if Bitcoin fails to recover significantly, CryptoQuant says

As summer approaches, CryptoQuant warns that Bitcoin miners could face significant difficulties, especially if prices do not recover significantly during the warmer months.

Even though the Bitcoin price has fallen below $58,000, causing weak investors to sell at current levels, the massive capitulation among Bitcoin miners has yet to begin. CryptoQuant head of research Julio Moreno said in an interview with crypto.news that the network’s hash rate is slightly higher than pre-halving levels, noting that miners “can still make a profit” with “relatively efficient equipment.”

Moreno says profitability can be seen in the breakeven electricity price for ASIC S19 and S21 models, which still remains above the electricity cost of large industrial miners (green field).

ASIC breakeven electricity price | Source: CryptoQuant

However, he added that some retail miners, especially those using older ASICs such as S17 and S19, may be experiencing negative profits “due to high electricity costs” and that the capitulation event “will depend on how network hashrate and prices evolve next.” . A few weeks.”

Addressing concerns about potential price volatility during the summer trading slowdown, Moreno emphasized that miners generally react to price movements rather than react to them. However, he did not rule out the possibility that Bitcoin may see more selling pressure in the coming months.

“[The market is] Miners are more likely to see capitulation if prices do not recover significantly during the summer months. Especially with the hash price (average miner revenue per hash) reaching new lows.”

Julio Moreno

As crypto.news previously reported, Bitcoin miners are not selling their crypto assets at current prices, even though their revenues have fallen to levels last seen in early 2023 due to the recent halving that reduced fixed block rewards from 6.25 BTC to 3,125 BTC. According to CryptoQuant CEO Ki Young Ju, miners now have two options: surrender or wait for the price of Bitcoin, which is currently trading below $58,000, to rise.