Bitcoin’s hash rate, a metric that measures miners’ revenue per terahash or processing power, has fallen to its lowest level ever. According to recent data, this is a sign that bullish momentum is coming.
A brief introduction from CryptoQuant analyst Woominkyu revealed that the current Bitcoin hash price level indicates a good buying opportunity.
A buying opportunity
Woominkyu shared a chart highlighting the relationship between Bitcoin price and the network hash rate. The chart showed periods where a drop in hash rate corresponded with BTC lows; therefore, based on historical data, periods of lower hash rates occurred simultaneously with BTC price lows.
With the hash rate at an all-time low, BTC price could be near or already at its bottom, 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 past 24 hours. Bitcoin had also fallen by over 8% in the past seven days from the $64,700 level. Woominkyu’s analysis suggests that BTC could skyrocket in the coming weeks, further boosted by macroeconomic developments.
Is a BTC rally coming?
Two weeks ago, Cryptopotato reported that Bitcoin’s hash rate had plummeted to an all-time low of $0.038 per TH/s from the $0.05 per TH/s level recorded shortly after the halving in April. The drop coincided with a capitulation of miners and a surge in Bitcoin’s hash rate.
A higher Bitcoin hash rate indicates more difficulty for miners as block production becomes more complex and competitive, requiring more computing power.
At the time, miner outflows also increased as smaller entities sold off parts of their holdings and reduced their reserves to stay afloat. Unfortunately, this group of market participants suffered massive losses on their sales as BTC fell to $49,000 amid the macroeconomic crisis stemming from the fall of the Japanese yen.
Interestingly, historical data indicates that miner capitulation events and major miner capital outflows are typically observed near BTC price bottoms in bull markets. This reinforces Woominkyu’s prediction that the cryptocurrency market could soon witness a Bitcoin rally.
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