According to an expert cited by CryptoQuant, recent market turbulence may signal that we have hit rock bottom.
The overall cryptocurrency market has seen a decline of more than 7% in the past week and over 3% in the last month. Bitcoin (BTC) fell below $65,000, while altcoins experienced significant corrections. Altcoins, known for their volatility, have suffered more than Bitcoin, losing over 4% of their market value in the past 30 days. BTC, on the other hand, has only dropped by around 3% in the same period, remaining in a sideways trend.
Miner Capitulation is a significant factor contributing to the current state of the market. A report from CryptoQuant highlighted that after the Bitcoin halving event, where block rewards were reduced by 50%, miner revenues plummeted by 55%. Miners have had to sell more Bitcoin to cover their operational costs, adding to the downward pressure on the token’s price.
Stablecoins, such as USDT and USDC, play a crucial role in providing stability in the volatile cryptocurrency market. However, recent low levels of stablecoin issuance indicate a slowdown in new capital entering the digital asset space.
Spot Bitcoin ETFs from major firms like BlackRock and Fidelity initially saw massive inflows, but recent outflows have added to the pressure on Bitcoin prices and the wider digital asset market. More than $600 million exited digital asset investment products last week following a hawkish Federal Reserve policy meeting.
Despite the current market conditions, analysts believe that a turnaround could be on the horizon in the near term. Historical data suggests that prolonged periods of low miner revenues and a high hash rate could signal a potential market bottom.