Bitcoin stakeholders with more than $1,490,000,000 worth of BTC are at high risk of capitulation, analytics firm Glassnode warns

Leading analytics firm Glassnode is warning that a certain group of Bitcoin holders who collectively own almost $1.5 billion worth of BTC is in danger of capitulating.

Glassnode says Bitcoin’s hash rate, which measures the processing power of the crypto king’s network, is at an all-time high.

While a higher hash rate indicates an increasingly robust network that is more secure against an attacker, Glassnode says that an increase in network hash power puts BTC miners in a financially precarious situation.

“Bitcoin Difficulty has adjusted to a new all-time high due to a rapid increase in network hashing power. This increases the cost of BTC production and puts additional pressure on miners.”

Font: Glassnode/Twitter

According to the analytics firm, the estimated cost to produce Bitcoin from mining activities now supports at $19,300, up from the current BTC price of $19,067. Glassnode says that the combination of the rising cost of production and the low price of BTC suggests that miners are at high risk of capitulation.

“This culminates in an increased risk of miner capitulation, which we capture in a tool that tracks Puell multiple and difficulty tape compression.

When both metrics are low, it indicates an elevated risk of capitulation for Bitcoin miners.”

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Source: Glassnode/Twitter

Puell Multiple is a metric that looks at BTC miner revenue, while Difficulty Ribbon Compression is an on-chain indicator that uses simple moving averages of Bitcoin network difficulty to determine the impact of miner selling pressure. in the price of the king cryptocurrency.

Glassnode also highlights that in recent months, BTC miners have been actively selling their reserves.

“Bitcoin miners currently hold around 78,200 BTC ($1.49 billion) in their treasuries, which has increased in aggregate since mid-2019.

The last few months have been the most notable slowdown in mining treasury growth in the last three years.”

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Source: Glassnode/Twitter

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Featured Image: Shutterstock/Jorm S

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