The data shows that the Bitcoin mining Hashrate has seen a significant drop from the peak at the beginning of March, a sign that the miners are leaving.
Bitcoin Hashrate Has Seen A 7-Day Rate Plummet Recently
“Hashrate” refers to an index that tracks the total amount of computing power connected to the Bitcoin network. Its value is measured in terms of hashes per second (H/s) or active exahashes per second (EH/s).
Miners connect computing power to the cryptocurrency network to solve certain mathematical puzzles that allow them the chance to add the next block to the chain. This computing power, however, never works as a cluster. Instead, miners compete against each other over the block reward using their individual mining facilities.
Although the total Hashrate does not work in parallel, its rate is still active in the network, representing the interest from the verifiers of the cryptocurrency. If the value of the metric increases, it means that new miners are joining the network and/or existing ones are increasing their resources. Such a trend can be a sign that the chain looks profitable to the verifiers.
On the other hand, the declining index suggests that some miners have decided to cut their rigs, possibly because they can no longer break through in their work. Now, here’s a chart from Blockchain.com that shows the trend in the 7-day average Bitcoin Hashrate over the past year:
Looks like the value of the metric has plunged over the last few weeks | Source: Blockchain.com
As shown in the graph above, the 7-day average Bitcoin Hashrate soared to an all-time high of 1,083 EH/s on March 1st. This high comes as the network recovers from disruption caused by the US snowstorm. In the days following this high, however, the metric reversed course, its value today sitting at 954 EH/s. This represents a decrease of about 12%, which is a significant figure.
The exodus of miners may be linked to the recent price trend that Bitcoin has faced. Miners make a large part of their income from block funding, which involves a fixed amount of BTC-denominated and is issued on a more or less time scale, leaving the cryptocurrency rate of USD as the only variable related to it.
In the chart, the relationship between miners’ income and price is visible. First, the Bitcoin Hashrate set an all-time high (ATH) as the price of the asset itself set a new high in October. Then, as the cryptocurrency saw bearish volatility, the index also moved to a general downtrend.
BTC has recently been stuck in a consolidation, so it’s possible that the lack of a bullish comeback has pushed some miners out, leading to a drop in Hashrate.
BTC price
Bitcoin saw some recovery in the past day as its price reached the $73,200 level.
The trend in the price of the coin over the last five days | Source: BTCUSDT on TradingView
Featured image from Dall-E, chart from TradingView.com
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