If you’ve been on Crypto Twitter, you’ve likely heard the term “miner capitulation” time and time again in reference to Bitcoin.
For those who missed the memo, when BTC started to tank last month, the Bitcoin network’s hash rate began to stall, failing to grow after months of growth in the cryptocurrency mining ecosystem. This trend led the Hash Ribbons, an indicator tracking moving averages of Bitcoin’s hash rate, to see a bearish crossover, resulting in an event known as “miner capitulation.”
The bearish crossover in the Hash Ribbons was last seen just before the now-infamous crash from $6,000 to $3,000 in late-2018. So, when this signal flashed last month, investors feared the worse, claiming that Bitcoin was about to fall off a cliff again.
And it did. Kinda. Since the Hash Ribbons crossed, the cryptocurrency has collapsed from $8,200 to as low as $6,400.
Though, it seems as though the era of miner capitulation is over, marking a huge boost for bulls in the medium to long-term outlook.
Bitcoin Miner Capitulation Over?
According to a custom “miner capitulation” indicator on TradingView, “recovery,” meaning the end of the miner capitulation phase, has just started on the one-day Bitcoin chart. This marks an end to the month-long miner capitulation that has plagued investors over recent weeks.
The reversal of the miner capitulation comes on the back of cryptocurrency data sites registering that the Bitcoin network’s hash rate recently hit an all-time high, seemingly reverting the capitulation that was taking place.
It’s good to see hashrate pushing back to all time highs here for the health of Bitcoin’s network pic.twitter.com/kSwLK5IH75
— //Bitcoin 𝕵ack (@BTC_JackSparrow) December 22, 2019
What’s notable about the “recovery” signal flashing is that this very signal marked a series of previous macro bottoms in Bitcoin’s price history.
NewsBTC’s analysis of the indicator found that “recovery” was seen at the start of January 2019, prior to BTC’s rally to $4,000, then $5,000, and so on; in August of 2016 after the previous halving, which kicked off a parabolic bull run that took Bitcoin to $20,000; and in 2015, prior to the moves that brought Bitcoin to $1,000 for the second time in history.
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But Wait, There’s More
This isn’t the only thing that should have bulls enthused.
CoinList’s Andy Bromberg argued that “we are seeing a level of building that has happened in 2019 [which makes it feel like] we’re in the moment of everyone is putting on their jumpsuits, ready to take off,” referencing the fundamental developments that Bitcoin, Ethereum, and other blockchains (and the firms backing them) have seen this year. Bromberg added that this level of building hasn’t been seen since 2017, boding well for prices in the future.
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