VanEck: Bitcoin’s Mining Slowdown May Actually Be a Good Sign
A new research note from VanEck suggests that the recent slowdown in Bitcoin mining might not be the bad news it appears to be. In fact, history shows it has often lined up with stronger price performance, not weaker.
In its mid-December ChainCheck report, VanEck looked at how Bitcoin has behaved during different phases of mining activity going back to 2014.
What they found was somewhat counterintuitive: when Bitcoin’s network hashrate was falling, prices tended to perform better over the following months.
According to the data, Bitcoin posted positive returns over the next 90 days about 65% of the time during periods when hashrate was declining. When hashrate was rising, that figure dropped to 54%.
VanEck describes this as a classic contrarian signal tied to miner stress. When prices soften and operating costs climb, less efficient miners are often forced to shut down.
That reduces hashrate — and, importantly, selling pressure. Historically, those conditions have tended to create better setups for long-term investors.
Hashrate drops to its lowest pace in over a year
That same pattern may be playing out again. VanEck noted that Bitcoin’s hashrate fell by roughly 4% in the month leading up to December 15 — the sharpest pullback in more than a year.
The firm also pointed out that when hashrate compression lasts for longer stretches, Bitcoin’s follow-on returns have not only been more consistent, but larger on average. In other words, extended miner capitulation has often marked periods of opportunity rather than danger.
Miners under pressure, institutions quietly buying
The pressure on miners has intensified alongside Bitcoin’s recent price drop. VanEck highlighted a sharp decline in mining profitability, especially for older-generation machines like the Antminer S19 XP.
The breakeven electricity cost for running those rigs has fallen significantly — from around $0.12 per kilowatt-hour late last year to about $0.077 by mid-December. That leaves only miners with access to very cheap power able to operate profitably, forcing others offline.
At the same time, Bitcoin’s price action has remained choppy. After peaking above $126,000 in October, BTC pulled back sharply and has struggled to regain momentum. It recently traded near $87,900, after briefly dipping into the low $80,000 range in November.
While miners are feeling the strain, longer-term investors appear to be moving in the opposite direction.
VanEck notes that digital asset treasuries increased their Bitcoin holdings during the recent drawdown, buying roughly 42,000 BTC between mid-November and mid-December. That pushed total treasury holdings to around 1.09 million BTC, the largest monthly increase since late summer.
A familiar setup from past cycles
Looking ahead, VanEck expects many of these institutional buyers to rethink how they fund future purchases. Instead of issuing common stock, the firm believes more treasuries may turn to preferred shares as a way to raise capital without diluting shareholders as aggressively.
Taken together, the report outlines a familiar cycle: miners under stress, falling hashrate, and steady accumulation by long-term holders.
If past patterns repeat, VanEck suggests the current environment could end up being more supportive for Bitcoin than it looks on the surface.
