This week is turning out to be a nightmare for Bitcoin enthusiasts who are already stressed with negative price action. On Saturday, Bitcoin looks to have potentially opened doors for a new bottom after dropping to the $19,000 level. The new Bitcoin mining data also supports the same sentiment.
Meanwhile, this new price level means breaking the norm in various forms. The current price of around $19,393 is way below the previous all time high of $19,700 level from 2020. Also, the 200-weekly moving average has also been breached with this price action.
Latest data suggests BTC current price is closer to the mining expenditure, meaning it is harder for small-scale miners to continue mining. This also throws more light on the real value of Bitcoin in the current scenario. Doctor Profit, a Bitcoin trader, called the situation unsustainable for average miners.
But more importantly, it is said that this could be a clear sign of finding the Bitcoin bottom. Although it was not clear as to when exactly there could be a Bitcoin price turnaround, historical data spills beans on it.
The situation could impact the mining activity as lesser number of miners would continue mining if Bitcoin price falls. Likewise, more Bitcoin miners would chip in if the price increases, effectively meaning more returns from mining.
Every time Bitcoin went below its production price, it marked the bottom for each cycle at the same time, the trader explained. Previous instances when this behavior was witnessed were in January and November of 2017 and most recently in a crash induced by the pandemic situation.
Additionally, recent data from analytics site Glassnode revealed that revenue generated by Bitcoin miners continued to fall. With the mining expenditure increasing and the overall macro scenario in a bad state, miners are less incentivized now.