- Recent bearish market conditions have significantly reduced bullish sentiment surrounding Bitcoin, with notable declines in positive remarks across social media platforms, potentially signaling a market bottom.
- Also, Bitcoin miner withdrawals have decreased nearly 90% since the block subsidy halving, indicating weakening sell pressure.
The recent bearish market conditions have significantly tempered the previously high levels of bullish sentiment and euphoria surrounding Bitcoin’s price, potentially signaling a market bottom.
Over the past few weeks, data from crypto analytics firm Santiment reveals a notable decline in bullish Bitcoin remarks across social media platforms such as X, Reddit, Telegram, 4Chan, and BitcoinTalk.
Since the Bitcoin halving in April, BTC’s price has been trading sideways. As per the Santiment data, trader sentiment was largely bullish at the beginning of April, in the lead-up to the bitcoin halving event.
With Bitcoin’s failure to reach new all-time highs, optimism has waned over the past three months as traders have lost confidence in the market. The only good thing off lately is that with the decline in the bullish calls, the bearish calls have also declined, but not to that extent.
This is because, as reported by CNF, Bitcoin miner capitulation has been very strong over the past few months after halving. Bitcoin miners have been selling heavily to cover up for their operational costs, which have shot up significantly with the reduction in mining rewards post-halving.
Bitcoin analyst Willy Woo observed that BTC price recovery typically follows “weak miners dying off and the hashrate recovering.” He noted that in 2017, the hash rate recovery took 24 days, while in 2021, it took only eight days. According to the Crypto News Flash report, the recovery has already spanned 61 days in 2024.
Bitcoin Miner Selling Pressure Decreases
According to recent data, Bitcoin miner withdrawals have dropped by nearly 90% since the block subsidy halving. In a Quicktake post on June 28, on-chain analytics platform CryptoQuant indicated that miner sell pressure is “weakening.”
Network fundamentals have shown a reshuffling, with both hash rate and mining difficulty declining from their all-time highs. CryptoQuant contributor Crypto Dan explained:
After the Bitcoin halving, mining rewards were cut in half, so older model mining machines were no longer used as they were no longer cost-effective. As a result, mining activity decreased, and miners began selling Bitcoin in OTC transactions to cover mining operation costs.
According to the popular Hash Ribbons metric, hashrate indicates “capitulation” among miners, with the 30-day moving average hash rate below its 60-day counterpart.
While this scenario is typically viewed as a buy signal by Bitcoin traders, analyst Crypto Dan believes the capitulation process is nearing its end.
“The current market is digesting this sell-off, and fortunately, the quantity of bitcoins miners are sending out of their wallets has been rapidly decreasing recently,” he noted. The analyst also stated:
In other words, the selling pressure of miners is weakening, and if all of their selling volume is absorbed, a situation may be created where the upward rally can continue again.
At the same time, the outflows from the spot Bitcoin ETF dropped last week, which is a healthy signal, per the CNF update.
As of press time, the Bitcoin price is 0.88% down at $60,876 with a market cap of $1.2 trillion. On the weekly chart, the BTC price is down by 5.3%.
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