Even though the ongoing bear market has been one of the shallowest historic drawdowns, miners have not been spared from a brutal year of business. Lawsuits, executive departures, rumored and actual bankruptcies and other symptoms showcase the pain shouldered by miners.

Luckily, a variety of market data suggests that the “capitulation” phase, which can often occur very near to the bottom, may have already happened.

In financial markets, the idea of capitulation refers to an acute and often dramatic crescendo of fear or widespread surrender by investors or businesses in the throes of depressed market conditions. For mining, this basically means miners were squeezed out of the market because the economics became so bad.

Five indicators point toward capitulation in the rearview mirror:

  • Miner Bitcoin balances are rebounding.
  • Miner Bitcoin outflows spiked, then fell.
  • Miners already tried selling everything.
  • Wall Street analysts pivoted.
  • Hashrate is noticeably declining.

Balances rebounding

Bitcoin mining addresses show notably larger balances compared to just a month ago, according to on-chain data. One-hop miner address balances have increased by over 3% (or roughly 85,000 BTC) since early October, as Braiins noted on Twitter. These addresses showed small reductions over the past year, but this data indicates a trend reversal is beginning.

Miner outflows

Miner outflows during the month of November–moving coins from miner addresses to some other location–also show signs of possible capitulation. In mid-November, Bitcoin miner outflows spiked to their highest level since June just as FTX insolvency became public knowledge.

Miners are notoriously bad at timing the market when they attempt to do so, and it’s not unreasonable to infer that the timing and size of these outflows were motivated (at least partially) by some panicked miners. Outflow fell back to normal levels only a week later.

Selling Bitcoin

In the past year, struggling miners have sold everything they can to stay alive. They’ve cut staff, sold Bitcoin balances down to nearly zero and even sold significant amounts of mining hardware–all to bolster cash balances and service outstanding loans. After employees, machines and Bitcoin itself, there’s nothing left to cut or sell. What’s left is either survival or bankruptcy. In the context of capitulation, the resources that could be capitulated seemingly have been.

Wall Street goes bear

Wall Street analysts are also turning bearish, dumping mining equities after hyping up valuations since December 2021. One analyst in particular–Chris Brendler of DA Davidson–argued as recently as July that mining stocks might be undervalued, as reported by CoinDesk. In late October, Brendler all but capitulated on mining, saying he is “pulling the plug” on mining upside, even though he still has a positive outlook on Bitcoin’s long-term potential. If that’s not capitulation, then what is?

Further back in December 2021, JP Morgan’s analyst Reginald Smith wrote a memo saying Iris Energy “has more than 100% upside” and was at a “deep discount.” Shares of the company were trading around $14 at the time of the memo. Now they’re trading below $2.


A hallmark of the current bear market has been the intense squeeze on miners with hashrate soaring and hashprice plummeting. Thus, another indicator of an inflection point in the bear market (a.k.a., possible capitulation) is a short-term trend reversal in Bitcoin hashrate. After seven of the past nine difficulty adjustments being positive, miners are (at the time of writing) looking at a roughly 11% decrease by early December when the current epoch ends. Hashrate is also notably off of its latest all-time highs over roughly 230 EH/s. In isolation, this data is not remarkable. But in context of the intense bear market mining squeeze and other signs of panic and pessimism throughout mining, it becomes more important.

Of course, nothing in this article should be construed as financial advice–because it’s not. Rather, the five points above are simply observations of the past year of market trends in mining and contrasting those to the signs of intense fear, panic, and pessimism throughout this sector of the Bitcoin economy. The immediate future may not be particularly easy for miners. More layoffs, some delistings, bankruptcy filings, and more bad news may make new headlines. But based on all available data, it appears that the brunt of the miner capitulation load that could be forced onto the market likely already has been. Now is the time to be optimistic, not bearish.