Bitcoin price rises, but FTX drama escalates and miners capitulate

Bitcoin koers stijgt, maar FTX drama escaleert en miners capituleren

Bitcoin (BTC) held above USD 16,000 after the dip to start the week and started to recover slightly last night. As of early this morning, bitcoin has been pushing against resistance around $16,500, the low end of the area bitcoin was in last week. At the time of writing, the BTC price stands at $16,483 on Binance and $15,895 on Bitvavo.

This means that the bitcoin price is 1.6% up today. Trading volume increased by 2.2% in the past 24 hours. The total market capitalization is $317 billion and the dominance is 37.9%. The Fear & Greed Index comes out at 26 (Fear).

Hawkish Fed and China protests

Many stocks closed in the red yesterday. This was partly because protests in China against the Covid lockdown are causing a lot of unrest in the financial markets. As a result, Apple shares in particular took a major hit.

Meanwhile, several Federal Reserve officials chimed in more yesterday hawkish than expected by suggesting that more rate hikes are needed to curb inflation. Bitcoin therefore only recovered after these markets closed.

FTX crash causes more problems

The consequences of the FTX crash continue to pile up. Amazon is even going to make a series of the drama. Yesterday you could read on Crypto Insiders that BlockFi has now filed for bankruptcy. However, things aren’t looking good for the company, as researcher Greg Lim of The Block reports:

Meanwhile, BlockFi is suing former FTX CEO Sam Bankman-Fried, the Financial Times reports. More on this later on Crypto Insiders.

Bitcoin miner capitulation seems to have begun

Yesterday morning we already wrote that bitcoin miners may have to capitulate. However, the amount of signals indicating this is increasing.

Bitcoin miners are having a hard time this year due to the falling price and high energy costs. Meanwhile, the ever-rising hash rate for a record high difficulty. However, it looks like the FTX crash may have been the last straw for some miners.

The hash rate, or the computing power of the Bitcoin network, is now falling rapidly. Blocks in Bitcoin’s blockchain are currently only processed every 11 minutes and 12 seconds, when it should be every 10 minutes.

According to estimates from BTC.com, this declining hash rate means that Bitcoin mining difficulty is expected to drop by as much as 6.5% next week, and perhaps even more:

Meanwhile, the BTC outflow from miners to crypto exchanges is increasing again. This can cause a lot of selling pressure and have a negative effect on the price if this outflow continues.

Number of bitcoin crabs at all-time high

However, there is also positive news to report. The number of so-called bitcoin crabs, investors holding 1 to 10 BTC is now at one all time high above 800,000. This group has been aggressively accumulating lately, reports On-Chain College:

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