On-chain data shows that the Bitcoin Hashrate has recently suffered a setback, a possible indication that miners may not believe the asset’s run would last.
Bitcoin Mining Hashrate has fallen from all-time highs
The “Hashrate” refers to a metric that tracks the total computing power of the miners currently associated with the Bitcoin network. The value of this indicator is measured in terms of hashes per second (H/s) or the larger and more practical terahashes per second (TH/s).
When the value of this metric registers an increase, it means that new miners are joining the network and old ones are expanding their farms. Such a trend implies that blockchain is a lucrative opportunity for these chain validators.
On the other hand, the falling indicator indicates that some miners have decided to disconnect their rigs from the network, possibly because they can no longer break even.
Here is a chart showing the trend in the seven-day average of the Bitcoin Mining Hashrate over the past year:
As shown in the chart above, the seven-day average Bitcoin hashrate had previously risen sharply and set new records. However, the value has fallen since peaking at around 755 million TH/s early this month.
The previous uptrend in the indicator was a result of the positive price action the asset enjoyed, as its price is directly linked to the miners’ revenue.
There are two ways these chain validators make their income: the transaction fees and the block subsidy. The first depends on traffic conditions and can change drastically from day to day. The latter, on the other hand, is subject to very specific restrictions.
The block grant remains fixed in BTC value for approximately four years, at the end of which an event called Halving cuts it exactly in half. These rewards are also paid out at a more or less constant rate, meaning that miners’ daily block grant earnings always remain fairly predictable in BTC terms.
However, one variable is freely changeable, and that is the USD value of these rewards. When the price rises, the miners’ block grant income also rises. This is why the Hashrate tends to grow in bullish periods.
Bitcoin has been discovering new highs lately, but the Hashrate has interestingly remained muted. The indicator is around 723 million, meaning it has fallen by more than 4% since the peak. This trend could indicate that miners expect the current rally to hit a roadblock.
BTC price
At the time of writing, Bitcoin is hovering around $91,900, up over 8% in the past seven days.
Credit : www.newsbtc.com
