Glassnode’s latest report highlights a continued rise in Bitcoin’s hashrate, reaching an all-time high, despite declining revenues for miners. At the same time, investor engagement with exchanges and trade volumes is showing a significant decline, indicating a reduced appetite for speculation in the market.
Bitcoin miners are demonstrating resilience, as noted in Glassnode’s on-chain report. Despite facing a 22% drop in revenues since March, miners have managed to push the Bitcoin hashrate to record levels.
The report indicates that while miners are grappling with volatile revenues, block subsidy revenue remains robust at $824 million, although transaction fee revenue has decreased to $20 million due to reduced demand for on-chain transactions.
Glassnode also observed a downward trend in investor interactions with exchanges. The report indicates that exchange-related on-chain volumes are contracting, reflecting diminishing investor interest in short-term trading. Both Bitcoin and Ethereum exchange-traded funds (ETFs) have experienced significant capital outflows, further highlighting the slowdown in market activity.
“Starting with the Bitcoin ETFs, net capital flows in USD have softened since August 2024, with an outflow of $107 million per week,” the report states. In total, U.S.-listed Bitcoin ETFs have seen approximately $1.2 billion in outflows over the past eight days, marking the longest streak of withdrawals since their inception.
The report notes that Ethereum ETFs have also faced outflows, totaling $13.1 million. This disparity suggests a difference in demand between Bitcoin and Ethereum under current market conditions.
Miners, who traditionally sold large portions of their block rewards to cover operational costs, are now retaining more of their newly minted Bitcoin, anticipating future price increases. However, rising mining difficulty and increasing energy costs are placing additional pressure on miner profitability.
Glassnode warns of potential sell-side pressure if market conditions worsen, as miners face the dual challenge of rising operational costs and declining revenues. The report paints a picture of a bifurcated Bitcoin market: while miners remain optimistic about the network’s long-term viability, short-term investors are exhibiting hesitance, as evidenced by declining exchange activity and ETF outflows.
As the fundamentals of the network remain strong, the dynamics between miner activity and investor sentiment will continue to shape Bitcoin’s future trajectory. The ongoing developments in the market suggest that while the long-term outlook may be positive, short-term volatility and investor caution will likely persist.
