The below is an excerpt from a recent edition of the Deep Dive, Bitcoin Magazine's premium markets newsletter. To be among the first to receive these insights and other on-chain bitcoin market analysis straight to your inbox, subscribe now.
In last Thursday’s Daily Dive, we covered the hash ribbons indicator and what it meant for the price of bitcoin. Since that writeup, hash rate has fallen even more, and it seems that the exodus out of China is the catalyst.
Since the beginning of May when hash rate was at an all time high, hash rate on the Bitcoin network has fallen by approximately 29.6%.
With the falling hash rate, Bitcoin has witnessed two straight downwards difficulty adjustments, of -15.97% and -5.30% respectively, with another of -16.1% estimated to be coming within the next week.
The fall in hash rate has placed immense strain on remaining miners on the network, who have seen their margins reduced due to slower block times.
Since June 1, the bitcoin balance in miner wallets has been reduced by 5,741 BTC, a confirmation that miners are facing increasing pressure.
It is also very likely that miners who are geographically located within China that are moving elsewhere are having to liquidate some of their bitcoin to cover the costs associated with exiting the region.