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Bitcoin’s Price, Miners, and This Volatility Indicator – All the Details!
Bitcoin’s recent price surge has been nothing short of impressive, with its market cap climbing to a staggering $2.1 trillion. However, an interesting development is taking place in the cryptocurrency mining sector. According to a report by Alphracta l, Bitcoin’s correlation with crypto mining companies’ market caps has sharply declined over the past year.
Typically, when Bitcoin’s price and market value rise, so do the market values of mining companies like Marathon (MARA) and Riot Platforms (RIOT). This is because miners earn a substantial portion of their revenue from the cryptocurrency they mine. As a result, the two variables have historically moved in tandem. However, recent data suggests that this correlation is breaking down.
A quick glance at the market performance of MARA and RIOT reveals that since December 2024, MARA’s market cap has fallen by over $2 billion to around $5 billion, while RIOT’s has dropped from $3.48 billion to $3.2 billion.
Furthermore, an analysis of miner reserves shows a significant decline in the amount of Bitcoin held by these companies. In just the first half of 2025 alone, the total amount of BTC held by miners fell by over 15% to a value of around $1.81 million.
This breakdown in correlation between Bitcoin’s price and mining company values has historically acted as a leading indicator for market volatility. The reason is that miner behavior can signal significant changes in market health. For instance, during the COVID-19 pandemic-induced crash in 2020, both Bitcoin and miner values plummeted simultaneously. A similar scenario played out following the FTX episode in 2022.
The implications of this development are quite telling. In the past, it has been observed that when miner stocks fall while Bitcoin’s price continues to rise, a regime shift is likely imminent. While it does not necessarily signify whether this change will be bullish or bearish, it could lead to an increase in market volatility.
In light of these findings, Bitcoin’s future performance could be quite uncertain. Some analysts suggest that the cryptocurrency may decouple from miner stock prices and continue its upward trajectory, potentially leading to a strong rally. On the other hand, if the correlation continues to break down, we might see Bitcoin’s price depreciate in conjunction with falling miner values.
As always, only time will tell which direction this market dynamic takes.
Source: ambcrypto.com
