Miner capitulation is a contrarian signal, indicates renewed BTC price momentum, VanEck says

Digital assets firm VanEck argues that declining Bitcoin mining activity, often seen as a negative sign of network stress and weak miner profitability, actually functions as a contrarian indicator suggesting renewed price momentum.

This dynamic is occurring as Bitcoin trades around $87,000 following a significant slide from its October high, exacerbated by the recent halving event. The drop in network hashrate reflects miner capitulation, where less efficient or leveraged miners shut down, temporarily increasing sell-side pressure.

However, VanEck notes that hashrate declines typically lag price drops, positioning the market near cyclical bottoms. As higher-cost miners exit, mining difficulty adjusts downward, improving profitability for remaining miners and easing forced selling. Historically, when 90-day hashrate growth was negative, Bitcoin delivered positive 180-day forward returns 77% of the time, suggesting that buying during these sustained corrections significantly improves long-term returns.

(Source：CoinDesk)