On-chain data shows the 7-day Bitcoin mining hashrate has just seen a new surge setting a new all-time high (ATH).
Bitcoin Mining Hashrate Has Seen A Sharp Increase Recently
According to data from Blockchain.com, the 7-day average BTC mining hashrate has seen growth recently. “Mining hashrate” here refers to a metric that tracks the total amount of computing power that Bitcoin miners have connected to the blockchain.
The BTC network operates on a consensus system based on proof of work (PoW), where miners use this computing power to solve mathematical problems.
This entire pool of energy does not work in tandem, however; miners use their mining farms to compete to be the first to add the next block to the chain, rather than collectively working towards a common goal.
This is by design, since if power were centralized in a group of companies, Bitcoin would not be able to call itself a “decentralized” network. But if there is no BTC power involved, then what is the importance of the total hashrate? The answer is simple: it is an expression of feelings among miners in general.
If the value of this metric increases, it means that miners find the BTC blockchain an attractive business. On the other hand, the registration decline suggests that some of these chain validators are no longer finding a profitable network, which is why they have decided to cut down their machines.
Now, here is a chart that shows the trend of the average Bitcoin hashrate for 7-day mining over the past year:
The 7-day average value of the metric appears to have seen a spike in recent days | Source: Blockchain.com
As shown in the graph above, the average 7-day mining Bitcoin hashrate has seen rapid growth over the past few days and surpassed the ATH set at the beginning of the month. The reason for this recent rise in the metric may lie in the price action that the cryptocurrency has enjoyed recently.
Miners make the main part of their income through block subsidy, a fixed reward of BTC they receive as compensation for adding blocks to the network. Block grants are awarded on a more or less time scale, so the only real variable related to miners’ profits is the USD price of BTC.
The increase in mining hashrate at the beginning of the month happened after the price rally. The miners expected that it would continue but when it became clear that it was not possible, they canceled their development work.
A similar pattern was seen last month. Now it remains to be seen whether the recent increase in Bitcoin mining hashrate will have the same fate, or if this price rally is one that will make the expansion worthwhile for miners.
BTC price
Bitcoin’s price rally has seen a reversal over the past few days as the commodity has returned to the $67,100 mark.
Looks like the price of the coin has been marching up recently | Source: BTCUSDT on TradingView
Featured image from Dall-E, Blockchain.com, chart from TradingView.com
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