Miners are speculators too, and I believe also something like quasi-energy traders. There's probably an expectation of higher electrcity prices per kilowatt hour within the year and they might be, moving some of their mining gear to other locations/regions with cheaper electricity, or because they're also "quasi-energy traders", they are scaling down because the market is bad.
This is probably a factor for continued decline of hash rate I agree, or why it at least it hasn't recovered as quickly as you might expect.
Have to say though that last cycle didn't see miner capitulation that would have given much of indication about impending lows though did it? 2020 comes to mind.
In
2018 miner capitulation signalled at $6.4K in October before the drop to $3.2K. The buy signal then arrived at $3.5K quite conveniently a few months later.
In March 2020 it signalled at $5.8K (after the big drop) with a buy signal at $7.7K. Throughout 2020 the
capitulation prices were lower than the buy signal prices.
Despite the misleading phrase, the indicator was never intended to be used to predict any price movements to the downside, only to the upside (based on network recovery followed by growth).
But what it miner capitulation? There are some people who say it like miners will stop, and turn off their mining farms. There will be no such thing because if mining farm 1 was shut off, mining farm 2 will say "thank you" and celebrate, with someone new building mining farm 3 because there's opportunity to arbitrage the "Bitcoin energy trade".
I assume you mean what is? It simply means hash rate in the mid-term (30 to 60 days) is correcting, or reducing. It ironically doesn't imply an outright capitulation of miners, like hash rate dropping in half such as in 2021. While some miners switching off will mean others will switch on, especially when difficulty is reducing, and some miners are paying much higher for electricity, this doesn't always occur immediately afterwards.
For example at the moment difficulty and hash rate have been reducing for around 8-10 weeks now, so there are more miners switching off than on and not enough "thank you very much". At least not yet.
