Bitcoin miner revenue falls 11% as difficulty hits record — Capitulation risk rises
Bitcoin miner revenue has declined about 11% over two months, dropping from roughly 562 BTC in mid‑October to about 502 BTC as of mid‑December, according to Glassnode. The fall in revenue comes despite mining difficulty reaching an all‑time high (~159 trillion in early November), squeezing miner profitability as they require more hashing power and electricity to earn the same rewards. Miner balance metrics show growing distribution: miners’ net position change moved back into the red (–487 BTC recently) after a larger outflow (–3,555 BTC) in late November that coincided with BTC trading near $80k. Short‑term holders (STHs) also remain underwater, with a reported STH cost basis near $102k while BTC trades ~30% below its $126k peak. ETF flows are volatile, with recent net outflows (~$80m) undermining sustained institutional support. For traders, these signals point to increased downside pressure: rising miner sales, falling miner revenue and elevated difficulty raise the risk of further supply entering the market, potentially testing the $90k floor and exacerbating volatility in the short term. Key metrics: miner revenue down 11% (562→502 BTC), mining difficulty ~159 trillion, miner net position change –487 BTC (recent), prior –3,555 BTC, STH cost basis ≈ $102k, ETF net outflows ≈ $80m.
Bearish
The combination of an 11% drop in miner revenue alongside record-high mining difficulty increases short-term selling pressure from miners, who face tighter margins and may liquidate holdings to cover costs. Miner net position changes returning to net outflows (–487 BTC) after larger prior outflows (–3,555 BTC) is a direct sign of distribution. Coupled with volatile and recently negative ETF flows (~$80m outflow) and short-term holders remaining below their cost basis, market liquidity and demand are fragile. Historically, periods where miners meaningfully increase sales (e.g., during prior BTC price pullbacks) have amplified downward moves, as concentrated supply meets waning demand. Short-term implication: elevated downside risk and higher volatility, with potential to test the $90k support or lower. Long-term implication: if BTC price stabilizes and ETF inflows resume, miner pressure eases as revenue improves and older machinery becomes less relevant; otherwise, sustained weak prices could force capacity consolidation and reduced hash rate growth. Traders should watch miner balance flows, mining difficulty, ETF flow data and STH cost basis for signs of capitulation or renewed institutional demand.