The Puell Multiple mirrored the 2020-2021 pattern. In November 2020, the metric reading stood at 1 before surging to the upper band (cycle top of $69K) in early 2021.
On November 13, Bitcoin miners cashed out as the BTC BTC $107 266 24h volatility: 0.0% Market cap: $2.13 T Vol. 24h: $8.46 B price hit the latest all-time high (ATH) of $93.4K. On Wednesday, miners sold 25K BTC coins worth over $2.25 billion, per CryptoQuant data. This was the highest daily miner sell-off since May 2024, as denoted by a spike in Miner Total Outflows, which gauges BTC transfers from miner wallets to exchanges.
Source: CryptoQuant
Usually, such a spike in miner sell-off coincides with local tops or price stalls, as seen in early 2024 (red lines). However, with the current market euphoria and extreme greed, whether the historical trend will repeat remains to be seen.
That said, miners have been intensely competing to produce blocks in the Bitcoin network, as mining difficulty hit a new high above 100 trillion units this week. Despite the cut-throat competition, miners were still profitable, with daily revenue rising from $29 million to over $40 million in the past two weeks.
The miner profit bump could be attributed to increased market interest in BTC after Donald Trump’s victory, which has been viewed as pro-BTC and crypto by market pundits.
As of November 12, the average cost of mining a single BTC was estimated at $82.4K per MacroMicro data. With BTC at $90K, mining a single BTC had a positive margin of about $8K, reinforcing current miners’ profitability.
Source: MacroMicro
Is BTC Market Overheated?
However, increased miner sell-off could weigh on the ongoing BTC rally and dent the $100K target expectations. So, what does increased miner profitability signal about BTC’s current valuation?
According to the Puell Multiple, which gauges miner profitability and, by extension, BTC valuation, there was still room for BTC to rally despite rallying above $90K. In past cycles, BTC hit cycle top when Puell Multiple reached the upper band (orange) between 4 and 10.
At press time, the metric spiked, indicating that miner profitability improved. However, the metric’s reading stood at 1, suggesting there was a lot of headroom before hitting the orange band.
Source: BM Pro
Interestingly, the Puell Multiple mirrored the 2020-2021 pattern. In November 2020, the metric reading stood at 1 before surging to the upper band (cycle top of $69K) in early 2021. Should the pattern repeat, BTC could hit a cycle top by Q1 2025 based on Puell Multiple insights.
Put differently, BTC was not overheated or overvalued despite the current rally to $90K. However, a similar and intense spike in BTC miner sell-offs in early 2025 alongside an overheated Puell Multiple could be a cause of concern and worth tracking.
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