Bitcoin News Today: Bitcoin Hashrate Drop Sparks Miner Exodus, History Points to Potential Price Rebound

Bitcoin has historically seen positive returns following declines in mining activity, according to a new report from VanEck. The firm notes that since 2014, the cryptocurrency has delivered positive returns 65% of the time in the 90 days following a drop in hashrate, compared to 54% when hashrate was rising according to VanEck's analysis. A 4% decline in Bitcoin's hashrate over the past month, the sharpest since April 2024, has rekindled this historical correlation according to VanEck's analysis.

VanEck describes the drop in hashrate as a contrarian signal, suggesting that weaker miners are exiting the market under financial pressure. The firm argues this "miner capitulation" could indicate a potential bottom for Bitcoin, as data shows when hashrate compression persists, Bitcoin's positive returns tend to be more frequent and substantial.

Mining profitability has deteriorated as Bitcoin's price has fallen. Breakeven electricity costs for mid-generation rigs like the Antminer S19 XP have dropped significantly, from around $0.12 per kilowatt-hour in late 2024 to approximately $0.077 by mid-December 2025 according to cryptopolitan.com. This decline signals that only the lowest-cost miners can remain viable, which could lead to a more sustainable market in the long term.

Historical Correlation and Market Bottom Signals

VanEck's analysis shows that Bitcoin's average 180-day returns are higher when hashrate is declining compared to when it is increasing. Specifically, when hashrate growth turned negative, Bitcoin posted positive six-month returns 77% of the time, with an average gain of 72%. In contrast, when hashrate was rising, Bitcoin still delivered positive returns but with a lower average gain of 48% according to VanEck's report.

The investment firm also noted that the current decline in Bitcoin's hash rate, at roughly 4% over the past month, is one of the most significant drops since April 2024. This decline has been compounded by recent events in China's Xinjiang region, where inspections led to the shutdown of 1.3 gigawatts of mining capacity and the offline removal of around 400,000 machines. This sudden loss of hashpower further supports the idea that miner capitulation is underway according to BeInCrypto.

Institutional Buying Amid Miner Struggles

Despite the struggles faced by miners, VanEck highlights that institutional buyers have continued to accumulate Bitcoin. Digital asset treasuries (DATs), for example, bought approximately 42,000 BTC from mid-November to mid-December, a 4% monthly increase. This accumulation brought their total holdings to around 1.09 million BTC, the largest monthly purchase since mid-July to mid-August 2025. The firm believes that DATs may increasingly shift from issuing common stock to using preference share proceeds to fund Bitcoin purchases, signaling continued institutional interest according to VanEck's analysis.

Bitcoin's price has fallen from an all-time high of $126,080 to a low of $81,000 over the past few months, and it currently trades at around $87,907. The 30-day volatility of Bitcoin has climbed above 45%, the highest level since April 2025 according to cryptopolitan.com. On-chain data also shows a decline in daily fees, active addresses, and transaction volume, adding to concerns about the broader market environment.

Outlook for the Market and Risks

VanEck suggests that miner capitulation and hashrate compression could point to a cyclical bottom for Bitcoin, but it also notes that macroeconomic conditions and regulatory developments remain key variables. The firm's historical data shows that miner capitulation has historically preceded significant price recoveries, as seen in 2018 and 2022. The current market conditions share similarities with those previous periods, including widespread miner sell-offs and declining profitability.

However, the firm acknowledges that predicting market bottoms is inherently uncertain. While miner capitulation may signal a near-term bottom, broader market forces such as geopolitical tensions and macroeconomic shocks can impact Bitcoin's price trajectory according to cryptopolitan.com. Investors should also consider the risks of regulatory uncertainty, volatility, and potential market manipulation, especially in less liquid environments.

What This Means for Investors

For investors, the current hashrate decline and miner capitulation present a mixed outlook. On one hand, historical patterns suggest that the market may be nearing a bottom, with potential for a rebound in the coming months. On the other hand, Bitcoin's volatility and macroeconomic headwinds mean that caution is still warranted.

VanEck recommends that investors monitor miner behavior, institutional buying trends, and regulatory developments. The firm also highlights the importance of diversification, given the unpredictable nature of the cryptocurrency market. While Bitcoin has historically delivered strong returns after miner capitulation, investors should be prepared for potential setbacks and market corrections according to blockchainmagazine.net.