The Bitcoin (BTC) network hash rate has decreased by 4% over the past 30 days, marking the most significant decline in nearly 2 years.
At the same time, the increased volatility and declining prices reflect the heightened pressure on miners as profits decrease. However, according to a report from investment management firm VanEck, miner capitulation may signal a bottom.
Bitcoin's mining power is declining due to falling prices and China ordering mine closures.
The Bitcoin ChainCheck report in mid-December 2025 from VanEck highlighted that a 4% decrease in network mining power is the highest since April 2024, with this contraction occurring during a tough month for Bitcoin, where the price dropped by about 9%.
Additionally, volatility has increased, pushing the perceived volatility over the past 30 days to over 45%, the highest level since April 2025.
We often expect the hash rate to decline when a large correction occurs in Bitcoin prices, Matthew Sigel and Patrick Bush wrote.
In addition to price-related pressures, Bitcoin's hash rate has also been affected by events in China. Last week, BeInCrypto reported that about 400,000 mining machines were shut down in Xinjiang province, China.
The shutdown of these machines resulted in a loss of power production of approximately 1.3 GW and significantly impacted the network, with China's processing power decreasing by about 100 exahashes per second within 24 hours.
This may be due to the shift in power production to meet the demand of AI and could lead to a withdrawal of mining power from the Bitcoin network of up to 10%, analysts said.
Meanwhile, the economic status of miners has worsened due to Bitcoin's price performance. According to VanEck, the breakeven electricity price on the 2022 Bitmain S19 XP mining machines decreased from USD 0.12 in December 2024 to USD 0.077 by mid-December 2025, representing a 36% decrease. Sigel and Bush added that,
Although miners' profitability has declined during this period, many groups continue to mine even during unfavorable economic conditions because they believe in the future of Bitcoin and to support the long-term hash rate of the Bitcoin network. We see that there are up to 13 countries mining with support from their federal governments.
Historical data signals an upward trend.
Despite facing recent pressures, VanEck pointed out that the decrease in the hash rate might be a bullish signal in contrast. Based on data since 2014, the report found that the forward returns of Bitcoin tend to be stronger when the network's hash rate decreases. Therefore, investors should continue to monitor this factor.
The forward BTC return over 90 days is in positive territory at about 65% of the time when the hash rate decreased in the past 30 days, compared to just 54% during the hash rate increase. Therefore, it can be seen that periods of decreasing hash rates tend to generate better returns.
Furthermore, the average forward return over 180 days has also increased slightly when the hash rate decreased to about 20.5% compared to about 20.2% during the hash rate increase, and this pattern is also observable in the long term.
Throughout 346 days since 2014, when the 90-day hash rate growth rate is negative, the BTC return over the next 180 days will be positive (77%) during that period, with an average return (+72%). Meanwhile, during other days, the BTC return over the next 180 days will be positive (~61%) on average (+48%), analysts said.
Technical charts support price base formation.
On the technical factors side, market followers have pointed out possible signs of a base formation. Market analysts, including Ted Pillows, have noted a bullish divergence of Bitcoin in the 3-day timeframe, which has previously indicated market bottoms in the last two instances. Therefore, this signal should be monitored closely.
The 3-day bullish divergence of BTC has been confirmed. In the last two instances before this pattern, Bitcoin formed a new market base, Pillows said.
However, it remains uncertain whether Bitcoin will be able to rally again. Currently, the leading cryptocurrency remains under pressure. BeInCrypto market data shows that Bitcoin is trading at 88,066 USD while pressing the news, down 1.01% in the past 24 hours.
