On-chain analysis is an emerging method of analysis which is exclusive to publicly auditable proof-of-work blockchains. A handful of analysts pioneered the field in 2017 by designing indicators like the Network-Value-to-Transactions ratio (NVT) to inform speculative activity.

A myriad of on-chain indicators have been designed since. Many are questionable but I have found that a few give particularly useful information for assessing market and mining dynamics. The Puell Multiple, Thermocap, SOPR, and MVRV were detailed in the latest Compass article.

You can access the full details of these four indicators below. In an upcoming piece, we will detail several on-chain indicators that have not lived up to the widespread attention they received.


Full Article Here: Four Bitcoin On-Chain Indicators Worth Watching


Market Movements – Hashrate Remains Near Record Levels

Bitcoin hashrate 7-day moving average
(Source: Bitinfocharts.com)


The seven-day moving average of hashrate remains close to record levels despite difficulty levels for Bitcoin mining being higher. The latest difficulty adjustment on the 20th of September recorded an increase of 11.35%.

Bitcoin price also declined by roughly 6% in the 48 hours following the difficulty jump, further tightening the margins of miners. The Puell Multiple recorded a decline of ~12% over this timeframe, showing that the price decline and difficulty jump had a significant impact on the issuance rewards earned by miners.

Large-scale Bitcoin miners recently received batches of latest-generation mining rigs. These miners will have given sufficient room for price declines and difficulty jumps so the rig deliveries will still be online. Only the most inefficient miners will have been impacted by the recent unfavourable price and difficulty movements.


Industry Developments – Updates from MicroBT, CCAF, US Congress, & MicroStrategy

The competition between Bitmain and MicroBT further intensifies as MicroBT outlines intentions to set up a US-based factory. MicroBT have captured a significant share of the Bitcoin ASIC hardware market this year amid a battle between the Bitmain co-founders. MicroBT has partnered with DCG-owned Foundry and a Southeast Asian company to establish a factory in the US. This will intensify competition in the growing North American mining market as a US-based facility will help miners avoid a 25% tax on hardware imported from China. North American Bitmain customers currently have the choice to import equipment from factories in Malaysia or Shenzhen.

Cambridge Center for Alternative Finance (CCAF) published their third cryptoasset benchmarking study. The study dedicates a lengthy section to exploring data related to the crypto mining industry. Several interesting datasets were included. The sample data provided insightful information including electricity rate ranges among different regions, renewables usage, and nonlinearity in the industry. We highlighted some of the key takeaways in a twitter thread.

Regulatory progress in the US may pave the way for more structured crypto-related financial products. Two bills were introduced by the US Congress last week. If introduced, the proposed Digital Commodity Exchange Act (DCEA) and the Securities Clarity Act (SCA) would provide US businesses with a regulatory framework which would make it much easier to introduce financial products relating to digital assets. BitOoda’s COO Tom Nath noted that “this type of clarity over asset classification… will enable us to continue to drive the development of new and innovative product offerings such as the BitOoda BTC Hashpower Contract and BitOoda BTC Transaction Fee Swap."

MicroStrategy CEO Michael Saylor revealed an additional $175 million of Bitcoin purchases on September 14th. MicroStrategy became the first publicly-listed US company to invest in Bitcoin as a strategic investment earlier in the year. In total, the firm has pumped $425 million into buying Bitcoin. Analyst Willy Woo highlighted that it took MicroStrategy six months of jumping through the regulatory hurdles to get Bitcoin exposure as a US-listed public company. It may take others 9-12 months. Woo speculates that MicroStrategy may have paved the way for a swarm of other firms to enter the Bitcoin market but we may not observe the onslaught until 2021.


HASHR8 Podcast – Core Scientific  SVP Taras Kulyk

Senior Vice President at Core Scientific Taras Kulyk joins the HASHR8 podcast and shares his experiences with large-scale mining facilities. Core Scientific recently announced a partnership with Bitmain to open a US-based repair facility and the firm has made significant strides in 2020. Taras explains the backstory behind how he entered the Bitcoin mining industry and also details his experiences working with large-scale mining facilities.

Watch Here: Scaling Massive Bitcoin Mining Farms with Taras Kulyk



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