Here’s why that’s good news

Bitcoin hashrate, a metric that measures miners’ revenue per terahash or computing power, has fallen to an all-time low. According to recent data, this is a sign of upcoming bullish momentum.

A Quicktake by CryptoQuant analyst Woominkyu revealed that the current bitcoin hashrate level indicates a good buying opportunity.

A buying opportunity

Woominkyu shared a chart highlighting the relationship between the price of Bitcoin and the network’s hashrate. The chart showed periods where a drop in hashrate corresponded with BTC dips; therefore, based on historical data, periods of lower hashrate levels occurred simultaneously with BTC price dips.

With the hashrate metric at its lowest level, BTC price could be near or already at its lowest, and historical data also shows that such price movements precede significant rallies.

At the time of writing, the leading crypto asset was in the red after falling from $61,000 to $59,400 in the last 24 hours. Bitcoin had also fallen by more than 8% in the last seven days from the $64,700 level. Woominkyu’s analysis suggests that BTC could surge in the coming weeks, driven by macroeconomic events.

A BTC rally coming?

Two weeks ago, CryptoPotato Bitcoin’s hashrate price has dropped to an all-time low of $0.038 per TH/s, down from $0.05 per TH/s recorded shortly after the halving in April. This drop coincided with miner capitulation and an increase in Bitcoin’s hashrate.

A higher Bitcoin hash rate signals more difficulty for miners, as block production becomes more complex and competitive, requiring more computing power.

At the time, capital outflows from miners also increased as smaller entities sold off some of their holdings and reduced their reserves to stay afloat. Unfortunately, this cohort of market participants suffered massive losses in their sales as BTC plummeted to $49,000 amid the macroeconomic crisis resulting from the Japanese yen’s collapse.

Interestingly, historical data indicates that miner capitulation events and larger miner capital outflows are typically seen near BTC price bottoms in bull markets. This reinforces Woominkyu’s prediction that the cryptocurrency market could soon see a Bitcoin rally.