Bitcoin (BTC) rallied to $91,950 on Wednesday as data showed the market sitting at a key inflection point. Data from Capriole Investments placed Bitcoin’s production cost near $83,873, while the electrical cost, the baseline energy input for mining, sits lower at $67,099.
Key takeaways:
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Bitcoin is currently trading just above miner production cost as profitability compresses.
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Elevated hashrate and collapsing hash prices are pushing miners toward stress thresholds.
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The dynamic NVT ratio dropped under its low band, historically bullish, but often with one final shakeout.
Bitcoin miner margins tighten as industry faces profitability stress
Currently, the BTC miner price stands at $87,979, leaving miners with a slim 4.9% margin, one of the lowest readings of the cycle. Historically, thin margins have acted as a stabilizing force rather than a stress signal. As profitability narrows, inefficient miners tend to drop off, difficulty adjusts, and the supply pressure from miners cools noticeably.
This often creates the kind of “quiet support” that Bitcoin forms during transition phases between fear-driven selling and longer-term accumulation.
Bitcoin miner price, production cost, and electrical cost data. Source: Capriole InvestmentsRecent data indicated that miner profitability has been strained by a surge in network competition. In October, Bitcoin’s hashrate hit a record 1.16 ZH/s, even as BTC’s price slid toward $81,000 entering November.
However, hash prices, the revenue miners earn per unit of computing power, fell below $35 per hash on Nov. 25, now well under the median $45/PH/s earned by public miners. Payback periods for mining rigs have stretched beyond 1,200 days, while rising financing costs and increased miner borrowing compound the pressure.
Cointelegraph reported that although many mining firms are accelerating pivots into AI and high-power computing, revenue from these services remains too small to offset the steep fall in Bitcoin mining income.
This is why the current compression in miner margins matters. When miner stress rises at the same time spot price approaches production cost, the market often enters a reset phase, where weaker miners drop off, difficulty adjusts lower, and overall selling pressure eases.
Related: Bitcoin price bottom due ‘this week’ with BTC down 20% in November
BTC’s Dynamic NVT dip is a constructive but imperfect signal
Alongside miner data, Bitcoin’s Dynamic Range Network Value to transaction (NVT) has now fallen below its NVT Low value of 194, slipping into what could be described as the network’s “value zone.” A low NVT value means Bitcoin’s market cap is lagging behind the strength of its onchain transactions, a condition that usually emerges late in corrections rather than early.
Historically, this has been a constructive development. Whenever Dynamic NVT enters this lower band, it signals that the market is undervaluing the underlying network activity, often setting the stage for a broader reversal once sentiment turns bullish.
Bitcoin’s price and dynamic range NVT analysis. Source: Capriole InvestmentsHowever, the signal comes with a caveat, as it has historically rarely marked the definitive bottom. In previous cycles, Bitcoin formed an initial low after the ratio dropped below the NVT low, bounced, then revisited the range before turning upward.
If that pattern repeats, BTC may exhibit one more sweep below $80,000. Even so, the combination of compressed miner margins and a Dynamic NVT value-zone signal places Bitcoin deeper into a bottoming structure rather than the middle of a prolonged decline.
Related: Bitcoin eyes rebound to $96K from current ‘discount’ zone: Analysis
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
Source: https://cointelegraph.com/news/bearish-bitcoin-mining-data-sends-countersignal-that-may-back-spot-btc-rally?utm_source=rss_feed&utm_medium=feed&utm_campaign=rss_partner_inbound
