We are experiencing one of of the biggest miner capitulations right now as the electricity bill for many miners is now higher than their profits.

This year has been literal hell for a bitcoin miner. Already since the Terra implosion earlier this year and the Russia-Ukraine War, the electricity costs in many parts of the world have been rising while the BTC price was plummeting. This has the consequence that miners are having a tough time to pay their bills as the BTC they mine is worth less but they have to pay more.

Now since the FTX crash and the further BTC price crash this has escalated further. Here a visualization of the problem:

​

Bitcoins electrical cost in comparison to price

As we can see for just the second time in the past 5 years the BTC price has breached the crucial mark to make it unprofitable to mine a BTC right now as the cost are higher than the value of the outcome. This usually causes a lot of miners to sell a lot of their holdings to just keep paying the bills.

​

Bitcoin Miner Sell Pressure indicator by Charles Edwards (showing a 400% rise in 3 weeks)

As this indicator shows, this might become be the biggest miner capitulations since years. Miners were once just mining and holding but now they have to sell if they want to remain in business, there is a ton of pressure on them now. And this will obviously cause the price to go down further and then this will cause even more miner selling. Which could lead us to be in a death-spiral like that.