Bitcoin has often surged after sustained hashrate drops, a trend that would provide much-needed relief to many struggling Bitcoin miners at current prices.
Bitcoin’s hashrate fell 4% over the month to Dec. 15, which could be a positive sign for the cryptocurrency’s price in the months ahead as miner capitulation is “historically a bullish contrarian signal,” VanEck analysts say.
“When hash rate compression persists over longer periods, positive forward returns tend to occur more often and with greater magnitude,” VanEck crypto research lead Matt Sigel and senior investment analyst Patrick Bush noted in a report on Monday.
They noted that since 2014, Bitcoin’s 90-day forward returns have been positive 65% of the time when the network’s hashrate had declined over the prior 30 days, compared with 54% when the hashrate rose.
