An analyst from CryptoQuant suggested that the recent market-wide slump might indicate a bottoming out.

The total cryptocurrency market has seen a decline of over 7% in the past week and more than 3% in the past month. Bitcoin (BTC) notably fell below the $65,000 mark, while altcoins experienced even steeper corrections.

Altcoins, known for their higher volatility compared to Bitcoin, have performed worse, losing over 4% of their market value in the last 30 days. BTC, on the other hand, has dropped around 3% during the same period, remaining in a sideways trading pattern.

1. Miner Capitulation

A report from CryptoQuant highlighted miner capitulation as a key factor in the market cap dip to $2.4 trillion. Post-Bitcoin halving, block rewards were halved, leading to a 55% drop in miner revenues. This shift forced miners to sell more Bitcoin to cover their expenses, increasing selling pressure and contributing to Bitcoin's stagnant price movement.

2. Low Stablecoin Issuance

Stablecoins like Tether's USDT and Circle's USD Coin (USDC), which are pegged to the U.S. dollar, play a crucial role in providing liquidity to the cryptocurrency market. Frequent issuance of stablecoins generally signals an influx of capital. However, analysts have noted a slowdown in new stablecoin issuance, indicating a stall in new capital entering the digital asset market.

3. Crypto ETF Outflows

Spot Bitcoin ETFs from firms such as BlackRock and Fidelity reached multi-billion-dollar valuations quickly, breaking Wall Street records. Recently, these funds have experienced outflows, further pressuring Bitcoin prices and the broader digital asset market. Last week, over $600 million exited digital asset investment products following a hawkish Federal Reserve policy meeting.

Despite the market's current lull, analysts believe a reversal could be on the horizon. "Historical trends suggest that periods of sustained low miner revenues combined with a high hash rate can indicate a potential market bottom," noted a recent report.