CryptoQuant CEO Ki Yong Joo stated that Bitcoin (BTC) miners are diversifying their mining activities into other cryptocurrencies to cope with the recent price drop. He noted that the hash price of Bitcoin has reached an all-time low, potentially leading to a decrease in mining investments and encouraging miners to explore other, more profitable coins as a temporary measure.
The hash price measures the expected revenues for each terahash per second (TH/s) of daily hashing power, giving miners an idea of their potential returns. Joo explained that many mining companies have reduced their investments and instead opted to mine other PoW coins to mitigate market risks. He emphasized that this strategy is not indicative of a long-term bearish outlook but rather a temporary hedge until purchasing liquidity improves.
Joo also acknowledged that this shift may indicate capitulation among miners, which is often a precursor to a bullish rise in Bitcoin. At the time of writing, Bitcoin is trading at a price of $62,100.
Furthermore, Joo highlighted the positive trend for Ethereum (ETH), citing its market value-to-realized value (MVRV) indicator. The MVRV indicator compares Ethereum’s market capitalization with its realized capitalization (the value of all ETH based on their purchase price), providing insights into whether Ethereum is undervalued or overvalued.
According to Joo, the rising MVRV of ETH indicates the beginning of altcoin season. He noted that ETH’s MVRV is increasing faster than BTC’s MVRV, suggesting that the Ethereum market is heating up relative to its on-chain fundamentals. Given the current ETF situation, this may be an ETH-only season, historically followed by a surge in other altcoins.
Note: The translation includes the original tweet and the image mentioned in the article.