Cryptocurrency analytics company Alphractal has published a remarkable assessment of the Bitcoin mining industry.
The report notes that miners are not selling their Bitcoin reserves despite facing historically low profitability.
Total transaction fees paid on the Bitcoin network have fallen to their lowest levels since 2012. This is attributed to the fact that on-chain activity has been extremely low this cycle, severely reducing miner revenues.
Despite the recent decrease in hash rate, there has been no adjustment to the network difficulty yet. This delay further narrows miners’ margins and delays the network from reaching balance.
The Bitcoin network is experiencing the highest hash rate fluctuations in its history. This is believed to be due to some major mining operations shutting down their ASIC devices, with falling revenues and decreasing network demand being cited as the reasons.
Despite the difficult mining conditions, the fact that miners have not yet sold their reserves is considered a positive sign. According to Alphractal, some mining pools may have scaled back their activities in line with the decline in global chain usage. With Bitcoin trading above $107,000, miners are thought to be reallocating hash power based on current demand.
According to the analyst firm, in past cycles, miners typically sold during periods of rapid price appreciation and increased network activity. However, both elements are currently at low levels, suggesting that the market may be in a period of “adjustment” rather than “capitulation.”
*This is not investment advice.
