Crypto Markets Under Pressure: Bitcoin Falls to $86,700 – Miner Capitulation Could Signal Bottom

Bitcoin and Ethereum Lose Significant Value

Just before Christmas, crypto markets are showing weakness: Bitcoin falls to as low as $86,700, Ethereum slips below the $3,000 mark ^[1]. The Fear & Greed Index signals "extreme fear" with only 24 points – a stark contrast to gold, which radiates greed with 78 points after reaching all-time highs ^[1].

Bitcoin is currently trading at $87,407.23 and is thus below the EMA-120, signaling short-term bearish pressure ^[1]. Ethereum is trading at $2,921.38, remaining below the EMA-120 at $2,982.62, which signals short-term weakness ^[1].

Macroeconomic Uncertainties Weigh on the Market

Monetary policy uncertainties are weighing on the market: While the U.S. Federal Reserve pauses interest rates, Japan slightly raises rates ^[1]. From a regulatory perspective, the announced withdrawal of crypto-friendly U.S. Senator Cynthia Lummis is causing disillusionment ^[1].

The shortened trading week around Christmas is dominated by new U.S. labor market data. On Wednesday at 2:30 PM (CET), the latest initial jobless claims will be published ^[1].

Altcoins Follow the Negative Trend

Other cryptocurrencies are also showing weakness. Solana is currently trading at $123.18, below the EMA-120 at $125.40 ^[1]. Aave is trading at $150.91, well below the EMA-120 at $162.89 – a sign of continued selling pressure ^[1].

Binance Coin is currently quoted at $843.12, below the EMA-120 at around $854.30 ^[1]. Zcash falls to $415.10, trading significantly below the EMA-120 at $430.81 ^[1].

XRP Under Pressure Despite Positive Corporate Developments

The XRP price has moved in a range between $1.8630 and $1.9062 over the last 12-24 hours, with the current closing price at $1.883 ^[2]. This occurs despite several successful acquisitions by Ripple totaling approximately $4 billion, the establishment of its in-house stablecoin RLUSD, and the spectacular trading launch of XRP Spot ETFs ^[2].

The short-term forecast for XRP is neutral to slightly bearish. Support levels are at $1.8826 and $1.8630, while resistance levels are at $1.9071, $1.9517, and $1.9810 ^[2].

Miner Capitulation Could Signal Bottom Formation

Analysts at VanEck see possible signs of bottom formation in the current situation with Bitcoin miners. The breakeven electricity price for a Bitmain S19 XP miner has fallen by nearly 36 percent from $0.12 per kilowatt-hour in December 2024 to $0.077 per kilowatt-hour in mid-December ^[3].

The hashrate has dropped by 4 percent – the sharpest decline since April 2024 ^[3]. This was likely caused by the recent shutdown of approximately 1.3 gigawatts of mining capacity in China ^[3].

International Support for Bitcoin Mining

Despite difficult conditions, according to VanEck analysts' estimates, up to 13 countries support Bitcoin mining activities ^[3]. These include Russia, France, Bhutan, Iran, El Salvador, the UAE, Oman, Ethiopia, Argentina, Kenya, and most recently Japan ^[3].