Bitcoin's hash rate reached a new All-Time High heading into Halving
The Bitcoin network's hash rate has reached an all-time high of 126 quintillion hashes per second . By comparison, on this day last year, the network was hashing at only 38 quintillion hashes per second.
However, what this indicates is of considerable importance: a trend toward increasing miner confidence. As such, concerns about miner capitulation in the lead-up to the halving show little credibility. After Bitcoin's stellar performance in recent times, news of the network's hash rate reaching another all-time high should come as no surprise.
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Over the weekend, the average daily hash rate peaked at 126 quintillion hashes per second. Testing any notion that miners are wary of the upcoming halving in May.
Hash rate is a term that refers to the processing power of the network. As Bitcoins are mined, transactions must be " hashed " before being added to the blockchain ledger. Each of these hashes is created by successfully completing a complex mathematical puzzle . The hash rate is a measure of how many times the network can attempt to complete this puzzle per second.
Therefore, a high hash rate indicates a good health of the network, as well as being a measure of network security. This is because hackers would have a hard time controlling more than half of the Bitcoin network, to perform a 51% attack, when the hash rate is so high.
Difficulty in mining
As more miners compete to complete blocks, the mining difficulty increases . And to remain profitable, only those with access to cheap electricity and the most efficient mining equipment can afford to stay in the game.
«Bitcoin is designed to evaluate and adjust mining difficulty every 2,016 blocks, or roughly every two weeks.»
Currently, mining Bitcoin is as difficult as ever, at 14.78T. In fact, since the beginning of 2020, the mining difficulty on the Bitcoin network has increased by 13%. Add to the mix the upcoming halving, when miners will receive half the reward (6.25 BTC) for completing a block, and the rational expectation is a mass exodus of miners. However, the trend toward ever-increasing hash rates suggests that more miners are joining the Bitcoin network, and this scenario doesn't appear likely to unfold.
Why is this? After all, if mining profitability is cut in half this May, why are miners continuing to shore up the network and in greater numbers? If the price of Bitcoin does not achieve significant traction after the halving, mining of Bitcoin, at current rates, would be unsustainable in the short term. This can only mean that miners are expecting a significant increase in the price of Bitcoin. Whether that will happen or not, nobody knows. But based on increasing hash rates, it's clear that miners think so.
