Miner capitulation

An unproven theory that miners will turn off their hardware and sell their coins if Bitcoin falls below a certain price and mining becomes unprofitable. The basis of the theory is that when the price of Bitcoin declines, smaller, non-industrial mining enterprises are forced to shut off their machines and dump their Bitcoin on the market in order to secure cash flow. While the assumption that smaller miners will seize operations when it is no longer profitable to mine Bitcoin, a full-scale capitulation has yet to occur.


In practice, the difficulty adjustment of Bitcoin mining adapts the expense of mining Bitcoin to market conditions. When the hash rate drops, the difficulty adjustment makes it easier to mine Bitcoin, which brings more miners into the mix and avoids capitulation.

A wallet address is the destination to which people send cryptocurrency. It is derived from the user’s public key.

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