Bitcoin Hash Rate Reaches New ATH Amidst Crypto Winter

Bitcoin mining hash rate hit a new high of 240.208 million TH/s on Sunday, according to crypto trading firm Blockchain.com. The new record high comes amid a crypto downturn that has pushed market prices down to multi-year lows.

Bitcoin hash rate declines sharply months after miners faced debt crisis

Bitcoin mining hash rate hit a new all-time high (ATH) of 240.208 million terahashes per second (Th/s) on October 2, according to data from Blockchain.com. In contrast, the price of the number one cryptocurrency is struggling to break above the $20,000 mark and is currently trading at $19,205.

The new data suggests that Bitcoin miners remain generally unaffected by the ongoing crypto winter. The downturn has hit crypto prices and sales of non-fungible tokens (NFTs) in recent months, with Bitcoin and Ethereum losing more than 50% of their value in the past six months.

The recovery in Bitcoin’s hashrate for mining started in mid-August. Since then, the world’s largest cryptocurrency has increased by more than 20% in terms of hash power. The mining hash rate refers to the total computational power used to mine and process transactions on the Bitcoin network.

A new hash rate all-time high comes just months after several major miners faced margin calls due to a steep drop in BTC amid the broader market decline. The cost of energy and equipment to mine Bitcoin did not fall in the same way. Crypto miners accumulated more than $4 billion in debt in July, reports showed at the time.

Due to such conditions, crypto mining companies were forced to sell millions of dollars of their bitcoin reserves to address the accumulated debt. Bitcoin mining hash rate fell by over 10% in June as firms stopped using their older mining machines due to low profitability.

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Meanwhile, Ethereum miners are turning to ETHPoW after the merger

The cryptomining game has also been significantly affected by Ethereum’s Merge earlier this month. The merger, arguably the most important development in the crypto industry in 2022, saw Ethereum transition from the Proof-of-Work (PoW) model to the Proof-of-Stake (PoS).

Since the merger, Ethereum has stopped relying on miners and the blockchain’s transactions are now verified by so-called ‘validators’. The shift to a PoS consensus mechanism is expected to reduce Ethereum’s carbon emissions by more than 99%, addressing one of the most criticized aspects of cryptocurrencies.

However, shortly after the merger, the mining community proposed a hard fork of Ethereum’s network that would allow an individual copy of the existing ETH network to continue with the PoW model. As a result, EthereumPoW (ETHW) was launched just one day after the merger.

Do you think Bitcoin mining hashrate will rise further after the bear market ends? Let us know in the comments below.

About the author

Tim Fries is the co-founder of The Tokenist. He has a B. Sc. in mechanical engineering from the University of Michigan, and an MBA from the University of Chicago Booth School of Business. Tim served as a Senior Associate in the investment team at RW Baird’s US Private Equity division and is also a co-founder of Protective Technologies Capital, an investment firm specializing in sensing, protection and control solutions.