Značka: mining

New BTC miner capitulation? 5 things to know in Bitcoin this week

Bitcoin (BTC) prepares to exit a grim November just above $16,000 — what could be on the menu for BTC price this week?In a time of what analyst Willy Woo has called “unprecedented deleveraging,” Bitcoin is far from out of the woods after losing over 20% this month.The impact of the FTX implosion remains unknown, and warning signs continue to flow in even after the first wave of crypto business bankruptcies.In particular this week, eyes are on miners, who are seeing profits squeezed by falling spot price and surging hash rate.Upheaval is in the air, and should another “capitulation” among miners occur, the entire ecosystem could be in for a further shock.As “max pain” looms for the average hodler, Cointelegraph takes a look at some of the main factors affecting BTC/USD in the short term.Bitcoin miners due “capitulation” — analystLike others, Bitcoin miners are seeing a major squeeze when it comes to selling accumulated BTC at a profit. It remains to be seen exactly how much financial pain the average miner is in, but one classic metric is preparing to call “capitulation” once more.Just months after the last such period, Hash Ribbons is warning that conditions are again becoming unsustainable.Hash Ribbons uses two moving averages of hash rate to infer conclusions about miner participation in the Bitcoin network. Crossovers of the trend lines denote capitulatory and recovery phases.For Kripto Mevismi, a contributor to on-chain analytics platform CryptoQuant, the time is approaching for the former to reappear.“So right now bitcoin difficulty is really high for miners so that means; costs are getting higher and doing business in this kind of environment is getting harder,” he wrote in a blog post. “That’s why miners do not work in full force. If they have efficient- new generation mining machines, they put them into work but that’s all. Inflation is high and people feels effect of living costs, bitcoin price is declining, mining cost and difficulty is getting higher. Tough environment for miners.”Bitcoin Hash Ribbons chart. Source: LookIntoBitcoinKripto Mevismi added that a significant change in mining difficulty could help the situation. Estimates from BTC.com for the next adjustment on Dec. 6 put the difficulty drop at 6.4% at the time of writing. Should it go to fruition, it will be the largest such drop since July 2021.BTC.com and others likewise estimate that hash rate is now declining from record levels as miners wind down operations.Bitcoin network fundamentals overview (screenshot). Source: BTC.comBTC/USD eyes volatility into monthly closeBTC/USD managed to stave off significant weekly losses at the latest candle close on Nov. 27.At around $16,400, the weekly close was a whisker higher than the previous week, with the pair still circling two-year lows, data from Cointelegraph Markets Pro and TradingView shows.BTC/USD 1-week candle chart (Bitstamp). Source: TradingViewWith a lack of volatility characterizing intraday price action, traders and analysts remain cautious on the next step.“It’s a long holiday weekend so expect things to get interesting as we move towards the Weekly and Monthly close,” on-chain analytics resource Material Indicators wrote in part of a tweet last week.A subsequent post reiterated that the Nov. 30 close would likely spark fresh instability, with BTC/USD currently 21.25% down versus the start of the month.This makes November 2022 Bitcoin’s worst November since its previous bear market year in 2018, data from Coinglass confirms.BTC/USD monthly returns chart (screenshot). Source: CoinglassOn shorter timeframes, popular trader Crypto Tony meanwhile highlighted $16,000 as a key zone to flip for higher levels to enter next, while keeping mindful of the longer-term trend.BTC/USD annotated chart. Source: Crypto Tony/ Twitter“Lower highs along with consolidating below a major resistance zone. If you want to enter safely, wait for a flip of the lows,” he summarized at the weekend.BTC/USD annotated chart. Source: Crypto Tony/ TwitterAs Cointelegraph extensively reported, Bitcoin’s next bear market bottom is the discussion point of the moment at present, and certain targets have become more popular than others.One vocal commentator calling for further downside, Il Capo of Crypto, thus reiterated his opinion that $12,000 could be next for BTC/USD.Highlighting the relationship between perpetual futures trading volume and spot price, he warned that current market structure was not supportive of further gains.“12000-14000 is likely. 40-50% drop for altcoins,” he stressed.Under the Bitcoin sea, hodlers accumulateBig or small, the population of the Bitcoin ecosystem is “aggressively” adding to its BTC exposure this month. In a positive sign for a future supply squeeze — where demand comes up against a larger portion of illiquid supply — accumulation appears to be gathering pace.According to on-chain analytics firm Glassnode, it is retail investors mostly responsible for the current trend.The smaller investors, referred to variously as “crabs” and “shrimps” depending on wallet balance, are increasing in numbers.“Bitcoin Shrimps (< 1$BTC) have added 96.2k $BTC to their holdings since FTX collapsed, an all-time high balance increase. This cohort now now hold over 1.21M $BTC, equivalent to 6.3% of the circulating supply,” Glassnode showed in a Twitter thread about the phenomenon.Bitcoin shrimp net position change chart. Source: Glassnode/ TwitterA further post noted:“Crabs (up to 10 $BTC) have also seen aggressive balance increase of 191.6k $BTC over the last 30-days. This is a convincing all-time-high, eclipsing the July 2022 peak of 126k $BTC/month.”Bitcoin "crab" net position change chart. Source: Glassnode/ TwitterAs Cointelegraph reported, part of the increase in smaller wallet numbers could be down to exchange users withdrawing funds to private storage.Woo flags inbound "max pain"For Willy Woo, the analyst behind popular statistics resource Woobull, on-chain metrics are pointing to Bitcoin’s next macro bottom being imminent.Highlighting three of them this weekend, Woo showed that to all intents and purposes, Bitcoin is behaving exactly as it did in the pit of previous bear markets.The portion of the BTC supply held at an unrealized loss, for example, is approaching macro lows, a phenomenon covered by the “Max Pain” model.“Bitcoin bottom is getting close under the Max Pain model. Historically BTC price reaches macro cycle bottoms when 58%-61% of coins are underwater (orange). Green shading adjusts for the coins locked up inside GBTC Trust,” Woo explained alongside a chart. Bitcoin Max Pain annotated chart. Source: Willy Woo/ TwitterContinuing, he noted that the MVRV Ratio value for BTC/USD is also targeting a “buy” zone, which has historically given investors maximum profit potential.MVRV is Bitcoin’s market cap divided by realized cap — the aggregate price at which each Bitcoin last moved. The resulting number has delivered buy and sell zones corresponding to price extremes.“MVRV ratio is deep inside the value zone,” Woo’s commentary stated. “Under this signal we were in already bottoming (1) until the latest FTX white swan debacle brought us back into a buy zone (2).”Bitcoin MVRV annotated chart. Source: Willy Woo/ TwitterWoo’s third chart, Cumulative Value Days Destroyed (CVDD), was recently covered by Cointelegraph.“Use these charts at your own discretion, we are in an unprecedented time of deleveraging,” he added, cautioning that “Past cycles do not necessarily reflect future ones.”Macro mood rocked by China protestsSome key economic data from the United States is due this week, but crypto analysts are more focused on China. With an already fragile status quo hanging on inflation trends, unrest in the world’s factory could unsettle market performance, some warn.China is in the grip of a wave of protests against the government’s policy on COVID-19, with multiple cities defying lockdowns to demand an end to “COVID zero.”With this in mind, risk assets could be in for a rough ride if the situation spirals out of control.“Crucial area of Bitcoin couldn't break, so we're still consolidating within that range. On support now,” Michaël van de Poppe, founder and CEO of trading firm Eight, explained. “If this is lost, I'd expect new lows to be seen on the markets, probably depending on China & FTX contagion this week.”Even mainstream media were warning of potential repercussions on the day, with John Toro, head of trading at exchange Independent Reserve, telling Bloomberg that “elevated contagion risk is being profiled into the cryptocurrency complex.”Asian stock markets were modestly down on the day, with Hong Kong’s Hang Seng and the Shanghai Composite Index down 1.6% and 0.75%, respectively at the time of writing.Hang Seng Index 1-day candle chart. Source: TradingViewBitcoin bottoms in crude oilOn a related macro note, Bitcoin is now in line for “outperformance” in U.S. dollar terms, one well-known analyst has said.Related: Bitcoin may need $1B more on-chain losses before new BTC price bottomIn WTI crude oil terms, BTC price action is already at a macro low — and history calls for a resurgence, which includes a significant appreciation trend against USD.“We're finally at channel bottom,” TechDev confirmed at the weekend. “Bitcoin's crude oil (energy) purchasing power topped in April 2021. Now looks poised for another leg of outperformance (and rise in USD value).”BTC/WTI annotated chart. Source: TechDev/ TwitterAn accompanying chart drew specific parallels to Bitcoin’s performance at the pit of the last bear market in late 2018.As Cointelegraph reported, meanwhile, TechDev is far from the only voice calling for upside to characterize BTC price action going into the new year.The views, thoughts and opinions expressed here are the authors’ alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

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Bitcoin mining revenue lowest in two years, hash rate on the decline

The revenue earned by Bitcoin (BTC) miners fell to two-year lows owing to poor market performance and a heavier computational demand amid rising network difficulty. However, an ongoing downturn in the Bitcoin hash rate over the past month has allowed miners to recoup losses.The total Bitcoin mining revenue — block rewards and transaction fees — in U.S. dollars fell down to $11.67 million, a number last seen on Nov. 2, 2020, when Bitcoin’s trading price was around $13,500.While the current market price of around $16,500 suggests an obvious increase in mining revenue, factors including greater mining difficulty and rising energy prices contribute to lower income in dollar terms.Adding to the above, the difficulty of mining a Bitcoin block has skyrocketed to an all-time high of almost 37 trillion — forcing Bitcoin miners to spend more energy and computational power to stay competitive. However, over the past three months, the hash rate of the Bitcoin network witnessed a steady decline. The hash rate stands at 225.9 exahash per second (EH/s), which fell 28.6% from its all-time of 316,7 EH/s on Oct. 31, 2022.The hash rate is a security metric that helps protect the Bitcoin network from double-spending attacks. However, considering the grand scheme of things, temporary measures taken by the community include acquiring cheaper mining hardware and resettling in jurisdictions with low energy prices.Related: Bitcoin miners look to software to help balance the Texas gridNew York City mayor Eric Adams believes that goal to make New York a crypto hub can be combined with statewide efforts to curb environmental costs related to crypto mining.“I’m going to work with the legislators who are in support and those who have concerns, and I believe we are going to come to a great meeting place,” said Adams while revealing that the city will work with legislators to find a balance between the crypto industry development and legislative needs.

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Iris Energy to cut mining hardware after defaulting on $108M loan

Australian Bitcoin mining firm Iris Energy is the latest to suffer from the squeeze of the crypto bear market, losing a significant chunk of its mining power after defaulting on a loan.A filing by the firm to the U.S. Securities and Exchange Commission on Nov. 21 revealed that it has unplugged its hardware used as collateral in a $107.8 million loan as of Nov. 18.The units “produce insufficient cash flow to service their respective debt financing obligations,” the firm noted. The operation generates around $2 million in Bitcoin gross profit per month but cannot cover the $7 million in debt obligations.Iris has now reduced its capacity by around 3.6 EH/s (exahashes per second) of mining power. It stated that capacity remains at around 2.4 EH/s which includes 1.1 EH/s of hardware in operation and 1.4 EH/s of rigs in transit or pending deployment.The company stated that its “data center capacity and development pipeline are unaffected by the recent events,” and it will continue to explore opportunities to utilize its capacity. Iris is also looking at the prospect of “utilizing $75 million of prepayments already made to Bitmain in respect of an additional 7.5 EH/s of contracted miners for further self-mining.”Earlier this month, the firm was served with a default notice for $103 million. Iris Energy primarily operates Canadian BTC mining centers that run on fully renewable energy. In early August, the firm doubled its hash rate after energizing facilities in Canada.Iris Energy stock (IREN) slumped 18% on the day to trade at $1.65 in after-hours trading. It hit an all-time low on Nov. 21, down 94% from its all-time high of $24.8 when it first traded in November 2021. Related: Bitcoin miners rethink business strategies to survive long-termBitcoin miners are currently suffering a triple whammy of high hash rates and difficulty, high energy prices, and low Bitcoin prices. This is causing a lot of them to either power down their hardware or start selling the asset. On Nov. 21, Capriole Fund founder Charles Edwards observed that the current rates of miner selling had been the most aggressive in almost seven years.“If price doesn’t go up soon, we are going to see a lot of Bitcoin miners out of business,” he added.It’s a Bitcoin miner bloodbath.Most aggressive miner selling in almost 7 years now.Up 400% in just 3 weeks!If price doesn’t go up soon, we are going to see a lot of Bitcoin miners out of business. pic.twitter.com/4ePh0TIPmZ— Charles Edwards (@caprioleio) November 21, 2022That price increase is unlikely to come anytime soon. Bitcoin slumped to a new bear cycle low of $15,649 during the early hours of Asian trading on Tuesday, Nov. 22, according to CoinGecko.

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Russian bill would legalize crypto mining, sales under ‘experimental legal regime’

A bill was introduced into the Russian State Duma, the lower house of parliament, on Nov. 17 that would legalize cryptocurrency mining and the sale of the cryptocurrency mined. Cryptocurrency cannot currently be used for settlements in Russia. The proposed law reads, “Digital currency obtained as a result of mining can be disposed of by the person who carried out the mining of this digital currency on the condition that Russian information infrastructure is not used in conducting transactions with it, with the exception of cases of transactions carried out in accordance with the established experimental legal regime,” as quoted by Interfax.Chairman of the Duma Financial Markets Committee Anatoly Aksakov told the local press that he expected the bill to pass all three parliamentary readings in December to come into force on Feb. 1. Other sources said the bill would become law on Jan. 1. Aksakov said:“Passage of the law will bring this activity into the legal field, and make it possible to form a law enforcement practice on issues related to the issuance and circulation of digital currencies.” The experimental sales regime is made possible by the law on digital innovation passed in 2020. The bill provides definitions of cryptocurrency mining and mining pools. It also bans the advertising of cryptocurrency in Russia.A Russian platform for cryptocurrency sales will be set up if the law is passed, and Russian miners will be able to use foreign platforms. In the latter case, Russian currency controls and regulations would not apply to the transactions, but they would have to be reported to the Russian tax service. There is currently no legislation on the taxation of mining activities, although crypto mining is widespread in Russia. Related: What the Russia-Ukraine war has revealed about cryptoA report issued by the Central Bank of Russia on Nov. 7 indicated that the country was preparing for the introduction of digital assets onto its markets. The Moscow Exchange drafted a bill on behalf of the Central Bank to allow trading in digital financial assets in September. Izvestia newspaper reported Nov. 18 that major Russian brokerages and the exchange were preparing for the entry of retail investors onto the market. A Russian policy on the use of crypto in cross-border payments was formulated in September. In addition to national legislation, Russian crypto miners and other users also have to navigate international sanctions.

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Australian firm raises $28M to expand Bitcoin mining capabilities

The turbulent climate of the crypto industry is not putting a full stop to builders in the space. Arkon Energy, an Australian renewable data center infrastructure company, recently raised millions to expand its Bitcoin (BTC) mining operations and acquired another European-based data center. The funding round was completed with $28 million raised by the data center infrastructure company, which uses 100% renewable electricity to mine BTC. Arkon extracts renewable power trapped in electricity markets to sustainably lowers its costs. Arkon CEO Josh Payne said this type of market creates the perfect storm for growth due to many factors: “The current market climate, with low prices for Bitcoin and mining equipment, offers a compelling opportunity to take advantage of our unique profitability and access to growth capital.”In addition, Arkon acquired one of Norway’s leading renewable energy-based data centers Hydrokraft AS, as a part of a larger plan to create a “vertically integrated green Bitcoin mining platform.”However, on Oct. 6, the Norwegian government recently proposed to eliminate the reduced electricity tax which is available for BTC miners in the country. The country’s finance minister said the power market is in a completely different situation now compared to when it first initiated the tax break in 2016. Similarly, in the Canadian province of Quebec, the energy manager for the region asked the local government to cut power from crypto miners due to high energy demands. Related: Bitcoin miners rethink business strategies to survive long-termThe current market downturn and industry turmoil has created a rough environment for many companies in the space to thrive. One recent example is that the BTC miner Iris Energy, is now facing a default claim worth $103 million from creditors in the United States. A filing with the U.S. Securities and Exchange Commission on Nov. 7 alleged that the company failed in restructuring to meet payment deadlines. The Hashrate Index recently released its Q3 mining report which revealed low hash prices, along with soaring energy costs made the quarter particularly rough for the mining industry. After BTC dropped below $20,000 this past September, hash rates climbed to a new all time high on Oct. 3.Amid the doom and gloom, some companies are pushing forward. The Chinese BTC miner Canaan, recently announced plans to scale its operations globally and include new research and development projects.

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Is GPU mining profitable after the Ethereum Merge?

The Merge forced miners to shift to alternative GPU mineable cryptocurrencies, a newly forked version or dump or sell their equipment at a low price. Shift to alternative GPU mineable cryptocurrencies One of the direct effects of the Merge includes miners turning to the Ethereum fork, Ethereum Classic (ETC), to keep utilizing their equipment. For instance, the blockchain fork’s hash rate increased the day after the Merge. The hash rate describes the computation power needed to approve a transaction on the blockchain through a proof-of-work consensus mechanism.  As Ethereum Classic blockchain still practices the PoW method for mining, Canada-based Hive blockchain (crypto mining giant) disclosed its plans to mine other proof-of-work cryptocurrencies like ETC, Dogecoin (DOGE) and Litecoin (LTC), among others. However, shifting to a PoW blockchain may undermine the environmental benefits that the PoS version offers. Ethereum miners can switch to a newly forked version A Chinese miner who resists Ethereum Network’s shift to proof-of-stake forked Ethereum to preserve the proof-of-work consensus method. The newly forked version is called the EthereumPOW (ETHW), which hopes to accommodate GPU miners in the future. The trade of tokens reflecting a proof-of-work fork of Ethereum is supported by cryptocurrency exchanges like Poloniex and BitMEX as well as the Tron blockchain.   Some of the GPU miners may quit the game Returning to past revenue figures that were provided on Ethereum is difficult. Those chances are low with stablecoin chains or any other PoW blockchain. Overflow of hash rate to alternative GPU mineable coins is also a threat to the mining venture.  It is challenging to earn previous rewards that were offered on Ethereum, due to which miners started shifting to alternative GPU-mineable coins. However, the increased hash rate means a hike in mining difficulty, causing miners to get rid of GPU miners.  Hive blockchain agrees that only miners with efficient equipment will succeed in the long run for this reason. As a result, many miners may sell their GPUs if the difficulty of alternate chains keeps increasing. On the other hand, the selling may not occur since a dumping effect will result from an increasing supply of GPU capability compared to a decrease in demand. Therefore, the likely outcomes of such a scenario can be a vast majority of miners either dumping or selling their equipment at low prices. However, as crypto mining places a lot of strain on the GPU hardware, gamers and even film editors might not be optimistic about buying the machines.

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Bitcoin miner Canaan scales operations despite low earnings, CEO says

Chinese cryptocurrency mining firm Canaan will continue to expand operations despite the ongoing bear market and an associated drop in earnings, according to the company’s CEO.Canaan posted a 90% over-the-quarter decrease in net income in Q3 2022, the firm officially announced on Nov. 14. The firm’s Q3 net income amounted to 61.1 million renminbi (RMB), or $8.6 million, which is a 88% decrease from the same period in 2021, Canaan noted.The company’s revenues dropped about 41% from 1.7 million RMB ($230,000) in Q2 2022, while gross profit plummeted 75% from 940 million RMB ($130 million) posted in the previous quarter.Amid Bitcoin (BTC) mining becoming less profitable due to the crypto winter, Canaan’s mining devices have also experienced a significant decline in demand. According to the latest financials, Canaan sold a total 3.5 million terahashes per second (Th/s) of computing power in Q3, or 37% less than in the previous quarter.Despite a downward trend in its latest financial report, Canaan does not plan to slow down the company’s growth. On the contrary, Canaan continues to scale its operations across the world, including research and development projects as well as mining operations, CEO Nangeng Zhang said.“As part of our ongoing effort to strengthen our research and development capabilities, we are expanding our Singapore headquarters with promising local research and development talents to help support our business on a global scale,” Zhang noted.He also mentioned that Canaan has been expanding its mining business in the United States this year, adding:“We face a very tough industry period as the Bitcoin price is sinking to lows the market has not seen in two years. Our priority is to conserve our cash, minimize our expenses, and endure this market downturn.”Apart from scaling worldwide, Canaan has been working on new mining solutions this year. In October, Canaan officially released its new mining device series, AvalonMade 13. The new series is based on the advanced application-specific integrated circuit technology, including two models featuring 110 Thash/s and 130 Thash/s hash rates.Canaan did not immediately respond to Cointelegraph’s request for comment.Related: Bitcoin miners ‘next trigger’ for BTC price crash as outflows hit multi-month highs“The launch of the new generation product reaffirms our confidence in the fundamental value of the Bitcoin ecosystem and reflects our constant efforts in the research and development of supercomputing technology,” Zhang stated.As previously reported by Cointelegraph, Canaan posted a 117% increase in gross profit in Q2 2022 over the same period in 2021. The company still expected a deterioration in financials due to the ongoing bear market.

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Elon Musk says BTC 'will make it' — 5 things to know in Bitcoin this week

Bitcoin (BTC) starts a new week on shaky ground after its lowest weekly close in two years.The largest cryptocurrency, considerably weakened after last week’s implosion of exchange FTX, continues to grapple with the fallout.In what is becoming an increasingly erratic market, investors are unsure what will happen next as more firms sound the alarm over solvency and regulators step up investigations in the crypto space.The mood among the majority is intensely fearful, and even some of the industry’s best-known names warn that it has been set back several years as a result of last week’s events.At the same time, for Bitcoin, it is business as usual. FTX is not the first such debacle it has weathered, and under the hood, the network remains as robust as ever.Cointelegraph takes a look at the factors set to influence BTC price action in the coming days as the average hodler gets to grips with major losses and ongoing volatility.Crypto braces for fresh FTX falloutWhile little is for certain in the current crypto market environment, it is safe to say that FTX and its aftermath is now the number one source of Bitcoin price volatility.The weekly chart says it all — a -$5,500 “red” candle for the seven days through Nov. 13 to the lowest weekly close since mid-November 2020, data from Cointelegraph Markets Pro and TradingView shows.BTC/USD 1-week candle chart (Bitstamp). Source: TradingViewAt the time of writing, BTC/USD is still around that close — $16,300 reappearing as a relief bounce after the pair wicked to just $15,780 on Bitstamp overnight.BTC/USD 1-hour candle chart (Bitstamp). Source: TradingViewThe story is far from over when it comes to FTX, as firms with exposure to the exchange and related entities find themselves in trouble.As such, commentators forecast, there may be repeat performances in the coming days and weeks as the knock-on effects put more and more crypto names out of business.Exchanges are particularly on the radar, with Crypto.com, Kucoin and others becoming the source of suspicion over liquidity.On the day, a spike in withdrawal transactions at Crypto.com and Gate.io led to warnings that it may be the latest exchange seeing a “bank run” as investors seek to take control of their funds.Data from on-chain analytics firm CryptoQuant showed 1,500 BTC leaving Gate.io on Nov. 13, with Nov. 14 currently at nearly 800 BTC and rising.Bitcoin outflows (Gate.io) chart. Source: CryptoQuantMore broadly, data showed exchange BTC reserves at an estimated 2.09 million BTC, CryptoQuant noting that due to the turmoil it may not reflect the true state of affairs.The last time that reserves were so low was in early 2018.Bitcoin exchange reserves chart. Source: CryptoQuantBitcoin bounces from $15,700 as Musk puts faith in BTCAgainst the backdrop of ongoing uncertainty, making BTC price predictions is thus no easy task.Turning to the moving average convergence divergence (MACD), analyst Matthew Hyland warned that the BTC/USD 3-day chart was about to repeat a bearish setup, which led to losses both times it appeared in 2022.“Bitcoin 3-Day MACD is in position to cross Bearish tomorrow for the first time since April,” he wrote. “It can be avoided if BTC can get positive price action before the 3-Day closes. Previous two crosses in the past year resulted in further downward price action.”BTC/USD annotated chart. Source: Matthew Hyland/ TwitterHyland nonetheless noted that after the 2014 Mt. Gox hack, Bitcoin took almost a year to find a macro price bottom after the initial shock.“It hasn’t even been 11 days since FTX closed up,” he added.Fellow analyst Il Capo of Crypto meanwhile argued that the market was prepared for a “final capitulation,” which may come sooner rather than later.This, he said in a series of tweets, would come in the form of a “bull trap” first then firm rejection, sending the market to new lows.For altcoins, he said, the comedown would amount to “40-50% on average.”On shorter timeframes, popular trader Crypto Tony feared that even the lowest weekly close in two years might fail to hold as support.“Nice breakout, but if we cannot hold the swing low at $16,400 then this was just a fake out and we wait for a test lower,” he commented about the recovery from $15,780 intraday lows.The move came as Twitter CEO, Elon Musk, came out in tacit support.“BTC will make it, but might be a long winter,” he wrote on the day in a Twitter debate.Twitter debate (screenshot). Source: TwitterA further short-term price catalyst came in the form of largest exchange Binance opting to create a dedicated recovery fund to help shield businesses.  Quiet macro week sees focus on stocks correlationThe picture outside of crypto further underscores the extent to which FTX has marked a “black swan” event for the industry.While Bitcoin and altcoins were busy shedding in excess of 25% in days, United States stock markets recovered from losses earlier in the month. As such, as research firm Santiment notes, there is a clear divergence occurring between Bitcoin and risk assets, this helping break a correlation that has endured throughout the past year.“As the trading work week closes, the week’s story is the distinct separation between crypto (after FTX’s fall from grace) & equities,” it summarized in a tweet last week. “Should $BTC traders’ trust recover after unfortunate events, there is a bullish divergence forming with the SP500.”BTC, ETH vs. stocks, gold correlation annotated chart. Source: Santiment/ TwitterMarkets commentator Holger Zschaepitz additionally noted the widening gap in performance of Bitcoin versus the Nasdaq.”Gap in weekly performance of sliding Bitcoin, rallying Nasdaq largest since 2020. Crypto universe shrank to the equivalent of 1% of global equities,” part of new comments read on the day. That decreasing correlation may come at a useful time macro-wise, as U.S. dollar strength makes some erratic moves of its own.The U.S. dollar index (DXY), having attempted a rebound past 107, failed prior to the Nov. 14 Wall Street open, with the implication that risk assets should rise as a result. Any return towards recent highs, however, and the picture could swiftly look very different.The intraday DXY lows nonetheless saw the index return to support not tested since mid-August.U.S. dollar index (DXY) 1-day candle chart. Source: TradingViewCommenting on the longer-term performance, however, popular trading outfit Stockmoney Lizards said that DXY had broken a parabolic curve in place since 2021.“Correction will be good for Bitcoin,” part of Twitter comments added.U.S. dollar index (DXY) annotated chart. Source: Stockmoney Lizards/ Twitter”Buy the dip” fever hits as miner sales slowWhile many existing hodlers are attempting to withdraw coins from exchanges or figure out how to nurse losses, not everyone is sitting still.On-chain data suggests that as BTC/USD hit multi-year lows last week, investors both big and small took the opportunity to “buy the dip.”According to on-chain analytics firm Glassnode, wallets containing between 1 and 10 BTC saw a dramatic increase.Bitcoin addresses with 1-10 BTC chart. Source: GlassnodeThe trend also appears to be playing out among the largest hodler cohort, the “mega whales” of Bitcoin. These entities with a wallet balance of 10,000 BTC or more are also growing, and now number almost 130, Glassnode shows.“Whales are accumulating at a pace never seen before,” popular social media commentator Crypto Rover reacted.Bitcoin addresses with 10,000 BTC or more chart. Source: GlassnodeA group firmly not in accumulation mode at present, meanwhile, is miners. After a sharp reduction in their reserves last week, the BTC hodled by miners tracked by CryptoQuant is still trending downward.From 1,858,271 BTC on Nov. 8, miners’ reserves now total 1,853,606 BTC as of the time of writing on Nov. 14.Despite this, reserves remain higher than at the start of 2022, and recent sales amount to an insignificant portion of miners’ overall position.Bitcoin miner reserves chart. Source: CryptoQuantSentiment data offers a modicum of hopePredictably, overall crypto market sentiment took a major hit thanks to FTX — but is it really all that bad?Related: $3 billion in Bitcoin left exchanges this week amid FTX contagion fearsAccording to the Crypto Fear & Greed Index, the industry may in fact be taking the slew of bad news in its stride.Over the weekend, the Index’s score touched a local low of 20/100 — firmly characterizing the market mood as one of “extreme fear.”That represents a 50% drop versus the peak of 40/100 seen on Nov. 6, these marking a three-month sentiment high.Nonetheless, 2022 has seen much lower scores, Fear & Greed reaching just 6/100 over the course of the year.Should further fallout hit, even a fresh 50% dive from current levels would only take sentiment to the area which normally marks macro price bottoms for BTC/USD — around 10/100.Crypto Fear & Greed Index (screenshot). Source: Alternative.meThe views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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Crypto token supplies explained: Circulating, maximum and total supply

A cryptocurrency’s maximum supply is the total number of tokens that will ever be mined, and it is usually defined when the genesis block is created. Bitcoin’s maximum supply is capped at 21 million, and although anything is possible, its strict protocol and code are built so that no more BTC can ever be mined. Other cryptocurrencies do not have a maximum supply but may have a cap on the number of new coins that can be minted with a specific cadence, like in the case of Ether. Stablecoins, on the other hand, tend to keep the maximum supply constant at all times to avoid a supply shock that could affect and fluctuate the price too much. Their stability is guaranteed by collateral reserve assets or algorithms created to control supply through the burning process. Algorithmically-backed coins are designed to maintain a stable price, but they have drawbacks as they are vulnerable to de-pegging risks. Also, non-algorithmic stablecoins like Tether may risk de-pegging, as happened in June 2022, showing that even coins that should provide more certainty may be at risk. The other two metrics — circulating and total supply — also affect a token’s price, but to a lesser extent than the maximum supply. When a cryptocurrency hits maximum supply, no more new coins can ever be created. When that happens, two main results are produced: The cryptocurrency becomes more scarce and as a result, its price may increase if demand exceeds supply; Miners have to rely on fees to get rewards for their contributions. In the case of Bitcoin, the total supply gets cut in half through a process called the halving, so it is calculated that it will reach its maximum supply of 21 million coins in the year 2140. Although Bitcoin’s issuance increases over time through mining and is therefore inflationary, block rewards are cut in half every four years, making it a deflationary cryptocurrency.

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Bitcoin miners ‘next trigger’ for BTC price crash as outflows hit multi-month highs

Bitcoin (BTC) miners could form the next BTC price “trigger,” research warns as withdrawals intensify.In a Quicktake post for on-chain analytics platform CryptoQuant on Nov. 10, contributor MAC.D suggested that miners could soon face “bankruptcy.”Research: Network conditions “will strangle” minersAfter BTC/USD fell 20% in a matter of days, miners began operating at a higher cost than the block subsidy and transaction fees they earned.The result is mining rigs being idled and miners selling BTC to cover expenses. “BTC security is at an all-time high, but its mining volume is gradually decreasing. This will strangle the miners,” MAC.D explained.He pointed to outflows from miner wallets passing 5,400 BTC for Nov. 9 alone, something which “can be interpreted as increased selling pressure.”Going forward, the situation could worsen should major mining firms end up selling stored BTC en masse as a way to pay obligations.“There is already a lot of news that mining companies listed on NASDAQ cannot pay their debts. If they go bankrupt, there will be a situation where they have no choice but to sell BTC,” the post continued:“Therefore, it is necessary to keep a close eye on the miner withdrawal table, and if the amount of miner withdrawal increases, BTC is likely to fall further.”A silver lining could nonetheless come shortly after such a major capitulation. Historically, there has been a correlation between miner wipeouts and BTC price bottoms.“But the bankruptcy of past miners has formed the bottom of the BTC,” the post concluded:“So when they go bankrupt, they have to use it as an opportunity to buy BTC.”Bitcoin miner outflows chart. Source: CryptoQuantMining costs outweigh gainsContinuing the theme, journalist Colin Wu, meanwhile, noted that even the most popular Bitcoin mining machines were now unprofitable.Related: FTX and Binance’s ongoing saga: Everything that’s happened until now“As BTC has fallen by 20% in the past 7d, F2POOL shows that bitcoin mining machines such as Whatsminer M30S and Antminer S17Pro have fallen below the shutdown price,” he tweeted on the day, linking to major mining pool f2pool:“Top bitcoin mining machines such as Ant S19 XP also account for 56% of electricity bills.”Charles Edwards, CEO of asset manager Capriole, also flagged the untenable cost of production versus miners’ income at current prices.“Many Bitcoin miners are now turning their rigs off,” he commented on a chart. Bitcoin mining production cost annotated chart. Source: Charles Edwards/ Twitter“Bitcoin’s electrical cost has just been breached for the 2nd time only in 5 years. The electrical bill for the average miner is now greater than the income earnt.”The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

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