Bitcoin Mining Activity Decline Could Signal Price Bottom, VanEck Report Shows

TLDR

• Bitcoin’s hashrate dropped 4% through December 15, marking the sharpest decline since April 2024
• VanEck analysis shows Bitcoin returns are positive 65% of the time in 90 days following hashrate declines, compared to 54% when hashrate grows
• Breakeven electricity costs for S19 XP miners fell from $0.12 per kilowatt-hour to $0.077 between late 2024 and mid-December 2025
• Digital asset treasuries purchased 42,000 BTC between mid-November and mid-December, a 4% monthly increase
• Up to 13 countries including Russia, Japan, and El Salvador are supporting Bitcoin mining operations

Bitcoin’s mining network experienced a 4% decline in hashrate through December 15. This marks the steepest drop since April 2024.

VanEck analysts Matt Sigel and Patrick Bush released a report on Monday examining this trend. They found historical patterns suggesting miner capitulation could lead to price gains.

The research shows Bitcoin’s 90-day forward returns were positive 65% of the time when hashrate declined over the prior 30 days. This compares to 54% positive returns when hashrate increased during the same period.

The pattern becomes stronger over longer timeframes. Negative 90-day hashrate growth preceded positive 180-day Bitcoin returns 77% of the time with an average gain of 72%.

Bitcoin currently trades at $88,400. The cryptocurrency is down nearly 30% from its all-time high of $126,080 reached on October 6.

Mining Profitability Faces Pressure

Breakeven electricity costs for the Bitmain S19 XP mining rig have dropped sharply. The costs fell from $0.12 per kilowatt-hour in December 2024 to $0.077 per kilowatt-hour by mid-December 2025.

This represents a 36% decrease in breakeven prices. The decline shows the difficult conditions miners currently face.

The recent hashrate drop appears linked to shutdowns in China. About 1.3 gigawatts of mining capacity went offline in the country.

VanEck analysts estimate this power could shift to AI applications. They project up to 10% of Bitcoin’s hashrate could be redirected for this purpose.

Bitcoin hit a low of around $81,000 on November 21. The cryptocurrency has shown volatility over recent weeks.

Institutional Buyers Step In

Digital asset treasuries increased their Bitcoin holdings during the price dip. These entities purchased roughly 42,000 BTC between mid-November and mid-December.

This represents a 4% month-over-month increase. Their aggregate holdings now stand at approximately 1.09 million BTC.

The buying activity marks the largest monthly purchase since mid-July to mid-August 2025. During that earlier period, treasuries added more than 128,000 BTC.

VanEck expects these entities to change their funding approach. The firm predicts they will move away from common stock issuance toward preference share sales to finance future Bitcoin purchases.

Multiple countries continue supporting Bitcoin mining operations. VanEck estimates up to 13 nations are backing mining activities.

The list includes Russia, France, Bhutan, Iran, El Salvador, UAE, Oman, Ethiopia, Argentina, Kenya, and Japan. These countries represent diverse geographic regions and economic profiles.

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