The worst of Bitcoin’s 50% drop may be over.
The Hashband indicator is about to mark the end of three months of miner capitulation. According to Glassnode data, this is one of the longest surrenders on record.
The metric compares 30-day and 60-day moving averages of hash rate and is based on the observation that Bitcoin typically bottoms when miners face the most financial pressure. Capitulation occurs when mining revenue falls below operating costs, forcing less efficient miners to shut down machines and sell BTC reserves to fund electricity, debt, and overhead costs. This combination reduces hashrate and adds to ongoing selling pressure in the market.
When the 30-day moving average of computing power returns above the 60-day computing power, a recovery signal will be triggered, indicating that miners are returning online, network pressure is easing, and that moment is coming. Historically, when this crossover is consistent with improving price momentum, it signals an area of strong accumulation.
Since the indicator first reversed in late November, Bitcoin has fallen from around $90,000 to a low of nearly $60,000 in early February before rebounding to around $65,000 at press time.
Such major adjustments are typical during miner stress events. Since 2011, there have been approximately 20 mining capitulations, most coinciding with local or major bottoms, including January 2015, December 2018, and December 2022.
Hashrate, or the total computing power securing the network, is now rebounding, indicating renewed confidence among miners.
Meanwhile, Bitcoin is currently trading below its estimated average production cost of $66,000, a level typically associated with deep value, according to checkonchain data. The last time this happened was in November 2022, when BTC bottomed near $15,500.
