On August 9, a Chinese mining pool operator with 400,000 BTC in cumulative block production published a statement that should have rattled markets. Instead, it was met with a shrug. Jiang Zhuoer, founder of B.TOP, argued that the current Bitcoin price range of $60,000–$70,000 is not a bottom—it is a “resting phase” before a deeper decline. The market consensus calls this a “calm bottom”. Jiang calls it unprecedented. The math didn’t support the calm, and the on-chain data screamed exhaustion.
Context: The Man Behind the Warning Jiang Zhuoer is not a Twitter analyst with a price target. He operates one of the largest mining pools by hashrate, giving him direct visibility into the real-time economics of Bitcoin production. When he says “insufficient losses”, he is not reading a chart. He is reading the P&L of every miner connected to his pool. The context of his warning is a market that has been range-bound for two months, with open interest at all-time highs and funding rates oscillating between neutral and slightly positive. The market believes the bottom is in. Jiang’s argument is that history says otherwise, and the data on chain says the same.
Core: The Systematic Teardown Let’s start with the historical analogue. In 2018, Bitcoin consolidated between $6,000 and $7,000 for 2.5 months. The range was approximately 16.7% from low to high. The market called it a bottom. Then it broke down to $3,000. Today, Bitcoin has consolidated between $60,000 and $70,000 for two months. The range is again roughly 16.7%. The structural similarity is undeniable. But the market learns nothing. It repeats the same emotional pattern: hope during consolidation, panic during breakdown.
Jiang’s core metric is “realized losses” or “losses in supply”. He argues that every historical bottom—2015, 2018, 2020—was accompanied by a period of extreme realized losses, where the market capitulated at a macro level. The MVRV ratio (market value to realized value) dropped below 1. The SOPR (spent output profit ratio) fell to levels indicating panic selling. Today, none of these metrics are at historic extremes. The realized loss is present but not overwhelming. The market is not yet in pain. In my 2018 ICO audit work, I learned that the worst projects survive until the real pain hits. Bitcoin is not a project, but the principle holds: without capitulation, the floor is not tested.
Miner economics add another layer. Jiang’s statement “losses are insufficient” likely reflects the fact that many miners are still operating at a profit, albeit thin. The current hashprice is around $0.05 per TH/s per day. For a miner with an S19 XP at 140 TH/s and 30 J/TH, electricity cost at $0.04/kWh yields a daily profit of about $2.20. That is not enough to force shutdowns. In 2018, when Bitcoin dropped to $3,000, the hashprice was below $0.02, and miners were bleeding cash. The analogy is not mechanical—the hardware efficiency is better now—but the math is clear: until the hashprice forces a wave of shutdowns, the bottom is not confirmed.
I built a model during my Terra/Luna analysis that used the same logic: track the cost of production for the weakest participants. When the price is above the marginal cost of the highest-cost miner, the supply continues. When it falls below, the market forces a shakeout. Today, the marginal cost of the oldest generation of miners (S9s) is around $60,000. That is precisely the lower bound of the range. If price drops below, thousands of S9s will go offline, reducing hashrate and increasing profitability for survivors. That is a classic cycle bottom signal. But it has not happened yet. The market is teetering on the edge, but the pain has not arrived.
Furthermore, the market structure shows a dangerous complacency. The funding rate has been flat. The perpetual futures basis is near zero. The VIX of crypto (DVOL) has dropped to below 50. The market is comfortable. That is the most dangerous state. Every rug has a seam you missed, and here the seam is the assumption that “this time is different” because of ETFs, institutional inflows, or the halving narrative. The ETF inflows have been positive but not massive. The halving is already priced in. The structural tailwinds are weaker than the narrative suggests.
Contrarian: What the Bulls Got Right I am not a permabear. I have analyzed over 50 token launches and five major protocol failures. The bulls have a point: the diminishing returns of Bitcoin cycles. Each cycle’s peak growth rate is lower. The 2018 drop was 84% from top to bottom. The 2020 crash was 63% (COVID). The 2022 drawdown was 77%. The magnitude of declines is shrinking. It is possible that the current consolidation is a new type of bottom—a “rotation bottom” where capital flows from altcoins to Bitcoin, but the aggregate price stays flat. The M2 money supply is still growing, and the Fed pivot is on the horizon. These are valid arguments.
But the bulls ignore the mechanism. The Bitcoin price is a function of marginal supply and demand. The marginal supply comes from miners who have to sell to pay bills. The marginal demand comes from new buyers. If the ETF demand is absorbed by the same holders who are selling, the price does not move. The on-chain data shows that the accumulation has been strong, but the distribution is also high. The net flow is near zero. The market is in balance, but that balance is fragile. One catalyst—a miner capitulation, a regulatory crackdown, a macro shock—could tip the scale.
Takeaway: The Accountability Call The market has a choice: believe the narrative of a calm bottom, or listen to the data that says capitulation is missing. Jiang Zhuoer’s warning is not a sell signal. It is a risk management signal. The question is not whether the bottom is in, but what happens if it is not. Based on my experience tracking failure points in DeFi protocols, the most dangerous time is when everyone agrees. The math doesn’t yet confirm a bottom. The on-chain losses are insufficient. The miner pain is not acute. The market is resting, not building. Hype burns out; structural integrity remains. And right now, the structural integrity of the bottom argument is weak. Act accordingly.
