Unusual signals from mining trenches
The latest measurements combine several miner health metrics, including profitability and revenue metrics, into a single measure of how much pressure the network’s block producers are under. On this subject, famous cryptography Analyst Wu blockchain Noted:
“The Minor Cycle Stress Composite Index has fallen to a new low in 2026, entering its ‘undervalued’ range. Similar synchronous declines have been seen before near the majors.” Bitcoin Bottoms for 2015, 2018, and 2020. ”
Each component tells the same story. The Puel Multiple, a measure that compares a miner’s daily earnings to the annual average, has fallen to 0.74, meaning miners are earning about a quarter less than the 12-month norm. Miner revenue has fallen by 11% in the past 10 days; Bitcoin‘s hash rate It has fallen more than 25% since October 2025, making it one of the longest continuous drawdowns in history.
One in five miners is underwater.
Stress is more than just a statistic, as JP Morgan analysts estimate Bitcoin has been below average production costs of about $78,000 for five consecutive months, with about 20% of miners incurring losses.
Networks appear to be adapting to population exodus BitcoinThe mining difficulty, which measures how difficult it is to find new blocks, fell by 10.09% to 124.93 trillion in the latest major adjustment, making it the second largest decline in 2026 after February’s 11.16% decline.
moreover, bitcoin dot com News earlier this year reported that despite a 7.15% increase in difficulty, miners absorbed an 18% hash price crash, with the expected daily return per petahash of computing power, the hash price, falling to $28.68.
There are casualties due to the pressure. Japan’s SBI Crypto announced last week that it would cease trading. bitcoin mining After 5 years, it will transmit 20,412 PH/s, which is just over 2% of the world total hash rateis looking for a new home before the pool stops accepting stock on July 30th.
Meanwhile, asset management firm CoinShares said mining margins are tight across the industry, estimating that 15% to 20% of miners are not profitable, and noted that many operators are accelerating the shift to artificial intelligence (AI) and high-performance computing workloads to survive.
The demand side has provided little relief. usa spot Bitcoin The exchange-traded fund (ETF) had its worst month since its inception in June, posting $4.5 billion in outflows. Bitcoin It fell below $60,000 during its weakest period this month.
Past capitulations suggest what happens next
Periods of extreme minor stress have historically been concentrated around cycle lows rather than highs. Vaneck’s previous research hash rate Due to contraction, except for the early history of the network, Bitcoin Over the 90-day period during these episodes, the median forward return was in the high 40s.
At the time, the company’s analysts envisioned three 90-day scenarios. A constructive path of 10% to 35% upside, a “capitulation light” range of -5% to +20%, and bearish If a loss of up to 30% occurs.
On-chain analysts are feeling similar tensions. CryptoQuant’s Miner Capitalization Index rose above 65, a level that analyst Axel Adler Jr. described as evidence of rising stress, but he emphasized that the Miner Capitalization Index remains below the extreme levels of the 2022 bear market, which was in tandem with a 65% decline in Bitcoin prices.
However, miners’ undervaluation alone does not guarantee a reversal, and sellers have repeatedly overwhelmed hopeful technical signals this year, as Bitcoin is down nearly 50% from its October 2025 high of around $126,200. The next test will be in the upcoming difficulty adjustment, where even more significant cuts will be made to ensure that unprofitable hashrate is still leaving the network.
