Bitcoin miners have seen some relief recently, as indicated by the recent movement of the Puell Multiple. After 191 days of struggle, this on-chain metric has finally experienced a much-needed rally, bringing positive news for the crypto mining industry.
Puell Multiple is a key metric used to assess the state of the Bitcoin mining industry. It measures the average daily Bitcoin mining revenue divided by the average daily electrical cost of mining. A value of 1 or higher indicates that the mining industry is generating enough revenue to cover its costs, while a value of less than 1 suggests that miners are operating at a loss.
Bitcoin miners get some relief
The recent rally in the Puell Multiple shows that revenue generated from Bitcoin mining has increased, allowing miners to cover their costs and potentially even make a profit. This is a much-needed boost for the industry, which has faced significant challenges in the past 191 days. according to technical analyst Peter Swift.
During this time, the Puell Multiple remained in the capitulation zone, indicating that the mining industry was struggling to cover its costs and operating at a significant loss. This situation likely led to further selling pressure, as miners sought to dump their Bitcoin holdings to mitigate their losses.
In fact, CryptoQuant’s on-chain data shows that total Bitcoin mining reserves have dropped by approximately 16,917 BTC since July 2022. This decline in reserves highlights a shift in the market, with miners potentially selling their assets or They use them to cover operating costs.
The drop in mining reserves raised questions about the overall stability of the mining industry and its impact on the broader crypto market. Still, with the recent rally in the Puell Multiple, it looks like Bitcoin miners can now breathe a sigh of relief, as the increased revenue should help reduce their selling pressure.
This is positive news for Bitcoin and the crypto market as a whole, as it suggests that supply-side pressures may ease, which could lead to higher prices.
Bitcoin has enjoyed some impressive bullish price action, posting gains of over 45% year to date. The pioneer cryptocurrency entered 2023 trading at a low of $16,540 and hit a high of $24,280 on Wednesday. overtaking ethereum. The uptick followed a Statement by Federal Reserve Chairman Jerome Powellhinting that the disinflationary trend in the economy has begun.
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