Bitcoin Hashrate Soars To New All-Time High, Will Price Follow


As Bitcoin jumped to $40K in the day following the Fed’s half-point increase, another number on the rise is the hash rate, which reached an all-time high of 221 EH/s.

Bitcoin
Bitcoin is up 6% on the day and is trading around $40K | source: BTCUSD on TradingView.com

Bitcoin, hash rate and price

The hash rate is the Bitcoin network’s unit of computing power and speed used to continue the calculations that confirm and process transactions on the blockchain. For this reason, the hash rate can reflect the global activity of bitcoin mining, increasing or decreasing in tandem.

Bitcoin price and hash rate metric are believed to be related. The higher the hash rate, the healthier and more secure the network, and this can drive up the price. However, this is not a guarantee because uncertainty at the macroeconomic level is an important factor that can dominate the future of its commercial value.

Also, many miners claim that the value of bitcoin has an effect on the hash rate and not the other way around as miners work around the network – whether they join or not – depending on the profitability of the moment.

Hash rate and climb difficulty at the same time

Just a week ago, Bitcoin difficulty hit an all-time high of 29.79 trillion after hitting block height 733824. As Arcane Research’s latest weekly report indicates, the algorithm has adjusted this difficulty in order to lower block production to the required level, and now it’s not Hard to mine bitcoin.

The difficulty was expected to decrease by 0.07% over the next week during the next adjustment. However, the same Arcane report notes that this increase in difficulty was not an obstacle to the new rise in online hash rate. This means that the next adjustment may instead turn into another increase, “which increases the difficulty even more”.

Although the months of March and April were slow for Bitcoin’s hash rate, it is now accelerating and climbing to an all-time high of 221 EH/s.

Related reading | Bitcoin trading has ballooned 15% since last week as analysts expect mining difficulty to increase

Bitcoin
Bitcoin hash rate reaches 221 EH/s | source: Mysterious Research Weekly Report

The required level of block production is 6 blocks per hour, but the increase in the hash rate a week ago turned into a fast block production rate of 6.45 blocks per hour.

Arcane Research data also indicates a 7% increase in daily bitcoin transaction fees, from $391,634 to $420,435 per week. However, Ethereum is still taking the lead in the area of ​​high daily transaction fees with an all-time high of $231 million at the end of last week, double the previous all-time high of $117 million.

This happened as a result of Yuga Labs minting 55,000 NFTs, which required a large amount of gas due to the increased activity of buyers. Ethereum’s scalability issue outweighs Bitcoin’s 7% increase in daily fees.

source: Mysterious Research Weekly Report

This also highlights the higher earnings of Ether miners compared to Bitcoin for more than a year.

Arcane Research explains that Bitcoin transaction fees have been minimal since the summer of 2021, and only make up about 1% of mining revenue, with the rest coming from block support, adding that Ether miners are finding higher profitability due to higher gas fees, even though their profits are more volatile.

Related reading | Bitcoin could see a 10% jump as volatility drops to 18-month low



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