The hash rate of the Bitcoin network has reached an all-time high as we approach the halving of Bitcoin mining rewards.
Bitcoin Hash Rate Surpasses 100 Quintillion Per Second
This weekend, the hash rate of the Bitcoin network attained a new all-time high, after surpassing the 100 quintillions per second mark. At the moment, the Bitcoin network hash rate stands at 126 quintillions per second. This is a massive rise from the 38 quintillions recorded for the same period in 2019.
The rising hash rate is a clear indication of miners’ confidence in the network despite the upcoming halving of mining rewardswhich will take place in May 2020. This means that the concerns over miners’ abandoning the network due to the halving are not necessarily credible.
The massive rise in Bitcoin’s hash rate comes as the leading cryptocurrency has performed exceptionally well in recent weeks. Over the past month, the Bitcoin price is up by nearly 20%, which represents a good return on investment for most people. Thus, it is not surprising that the network hash rate has been rising alongside the BTC price.
The term ‘hash rate’ is used to describe the processing power on a blockchain network. As Bitcoin is being mined, transactions have to be processed (hashed) before they are added to the Bitcoin blockchain ledger. Each hash is created after a miner successfully solves a mathematical puzzle. Thus, the hash rate is a measure of the number of times the network completes the puzzle per second.
The high hash rate means that several miners are participating in the network and is a sign of good health for the blockchain. It is also a metric to show the strength and how secure the network is. With several miners working on a blockchain, it would be tough for hackers to control more than half of the network, leading to what is known as the 51% attack.
Mining Difficulty Increases
The rising hash rate means that more miners are competing to complete the blocks, which eventually increases the mining difficulty. As the mining difficulty increases, it becomes harder for mining to be profitable. It will only be profitable for miners who have access to cheap electricity and efficient mining hardware.
The mining difficulty at the moment is at its highest, having risen to 14.78T. Since the beginning of the year, mining difficulty on the blockchain network is up by 13 percent. The increase in mining difficulty and the upcoming halving are the reasons why some analysts believe miners will leave the Bitcoin network en masse.
However, as explained earlier, the increase in hash rates means that more miners are joining the Bitcoin network rather than exiting it. This could mean that miners are expecting a significant surge in the price of the leading cryptocurrency in the coming months.