jakiro
Source: On-Chain Mind, compiled by: Shaw bitchain vision
Speaking of Bitcoin, miners are almost the most familiar insider we are insiders.Their reserves, income and behavior not only reflect the operation of the network, but also often heralds the direction of the market.
They are under constant economic pressure.How they manage their funds, cash flow and infrastructure reflects the underlying health of Bitcoin better than any chart.
In this article, we will analyze the signals currently sent by miners, the structural changes that affect the industry, and the impact of these changes on Bitcoin and mining stocks.Ignore these signals and you will miss an important piece of the puzzle.
Overview of key points
-
Network demand cools down: Bitcoin’s average block size declined, indicating that network activity has calmed down despite the record highs.
-
The miner’s economy is strong: Even after halving, daily income is still at a high level in multiple cycles.
-
Structural changes in reserves: Miners continue to distribute tokens rather than hoarding, which marks the industrialization of the industry.
-
Stocks and Bitcoin: Mining stocks are highly correlated with Bitcoin, but are currently in overbought state, so it is more risky as a substitute for directly holding Bitcoin.
Average block size
One of the most direct yet illuminating metrics is the average block size in megabytes (MB).itMeasures the amount of transaction data packaged in each Bitcoin block.
Historically,Bitcoin’s block size limit was set to 1MB in the early stage, this is the upper limit introduced by Satoshi Nakamoto to prevent spam and ensure scalability.But then,This cap was expanded in 2017 through SegWitness (SegWit), allowing the size of each block under optimal conditionsUp to 4MB.
now,The average block size hovers around 1.5 MB, despite the high Bitcoin price hitting a new high, the number has dropped slightly in recent months.This doesn’t mean that Bitcoin is weakening – it just reflects a temporary slowdown in demand for block space.Importantly, miners’ profitability depends largely on transaction fees, and a decrease in block congestion will reduce their fee income.
Average block size provides a real-time snapshot of demand and fluctuates with price and mass market speculation.
This decline is not a red flag to network integrity; instead, it indicates a temporary decline in transaction throughput and network usage.
This is the pulse of the Bitcoin economy – sometimes it jumps wildly and sometimes it is stable.
Income: Resilience after halving
The mechanism to halve block rewards every four years always raises concerns that miners will be forced to exit the market.However, history shows that miners can adapt – the recent halving is no exception.
Nowadays, minersTotal revenue per day is about $55 million, this level was only surpassed when it was a brief surge to $70,000 before the latest halving.
After the halving in April 2024, many people expect revenue to shrink.However, data show revenue is climbing and exceeding most of the previous cycle.
The resilience of mining is important because:
-
This shows that despite the reduced circulation, the network is still secure.
-
High income supports reinvestment and expansion of infrastructure.
-
Strong miner economic benefits provide confidence in the continued growth of computing power (and security).
in short,Half does not weaken the miners’ strength, in turn, strengthens the economic pillar of Bitcoin.
Reserve: From long-term holders to businesses
In 2019, miners held more than2.5 million BTC.Now, this number hasReduced to 1.8 million, and there is no sign of reversal.
This long-term reduction tells a story of transformation:
-
Early: Miners usually act like investors, hoarding cryptocurrencies as speculative assets.
-
now: Mining has been industrialized.Operators continue to sell cryptocurrencies to maintain operations, reinvest and manage cash flow.
By gradually allocating tokens, miners can avoid a “surrender-style sell-off” – a sudden flood that caused prices to plummet.It promotes organic price discovery, relying on diversified investors rather than concentrated groups.
At first glance, the continued selling seems to be bearish.But in fact,This is a positive progress:
-
It can prevent miners from collectively selling reserves and triggering a sudden “supply shock”.
-
This makes Bitcoin price discovery no longer dependent on miners but more dependent on broad market demand.
The decline in miner holding reserves reflects an increasingly mature ecosystem where miners play the role of infrastructure providers rather than speculators.
Surrender risk stress level
In the Bitcoin space, nothing is more important than whether miners are forced to sell Bitcoin.To track this situation, we used the “miner surrender risk indicator” to compare the short-term (30 days) and long-term (60 days) computing power averages.
-
Green area=Stable miners, the risk of large-scale sell-off is lower.
-
Red area=There is a higher possibility of surrender for miners in high pressure.
Historically, the green area has been the best place to increase holdings.Although they are not predictive, they usually reduce downside risks.
Currently, the indicator is dark green.This is important because:
-
This shows that miners are in good financial condition and are unlikely to sell their holdings.
-
Historically, such periods often signal a strong rebound because of the small supply pressure.
-
Since May 2023, there has been a strong uptrend after each low-risk reading.
This indicator is one of the clearest windows to observe the internal health of Bitcoin.And now, it shows:The market situation is stable.
Mining stocks: Risk alternatives
Publicly listed mining stocks—such as Marathon, Riot and Hive—provides investors with indirect investment in Bitcoin.But how do they actually perform?
Miner Stock Relevance Indicators track how closely these stocks are associated with Bitcoin prices.at present,Very high correlation——This means that the trend of miners’ stocks is almost synchronized with Bitcoin.
Miners stocks are mostly associated with Bitcoin, and the real advantage comes from making smart trading in those rare red areas.
This is important because:
-
Miner stocks function similar to leveraged Bitcoin exposure, which amplifies gains and losses, but not exactly that.
-
In most meaningful time frames, the miner’s stockNot as good as Bitcoin itself.
-
Unless you have a clear advantage, hold it in a mining companyLarge investments will increase volatility without sustained outstanding performance.
Personally, I will not allocate more than 5% of the funds in my portfolio to miners’ shares.This is just a tactical investment operation, not a core position.The benchmark is always Bitcoin.
Mining stock RSI
To measure stock momentum, we can look at the relative strength index (RSI) of mining stocks.
-
Above/below 50= Long/shoulder trend.
-
More than 75= Overbought.
-
Less than 35= Oversold.
RSI shows that even if Bitcoin rises, it may have a pullback due to its overvalued valuation.
Currently, the RSI value of miners’ stocks (on average) is at the highest level since I started tracking in early 2024.This is a double-edged sword:
-
On the one hand, it confirmsExtremely bullish momentum.
-
On the other hand, it warns that the industry hasOver-expansion is susceptible to short-term pullbacks.
Mining stocks may perform poorly even if Bitcoin rises further, simply becauseThey’ve been rising too far and too fast.To me, this meansCare should be maintained.
Summarize
Looking back at the data, we can see that the scene presented is surprisingly consistent.Internet activity cooled slightly, but miner income remained strong.Meanwhile, the way miners manage their reserves shows that the industry has matured – they no longer hoard Bitcoin for future profits, but instead operate like formal businesses, selling steadily to support business growth and cover costs.This shift is healthy; it eliminates the risk of sudden supply shocks and prompts Bitcoin price discovery to rely more on organic demand.
The most encouraging signal in my opinion is the lower risk of surrender.The miners are stable and profitable and are not under pressure to sell out a big way, which provides a positive backdrop for Bitcoin itself.But when it comes to mining stocks, I am cautious.They usually fluctuate in synchronization with the Bitcoin price, and now they are overheated, making them a riskier alternative to holding Bitcoin itself directly.
For me, the lesson is simple: Bitcoin is the benchmark.Miners’ stocks may bring tactical gains, but their volatility and long-term poor performance mean that they can always be considered a supporting role in my portfolio.
