Bitcoin Mining Hashrate Registers Third Largest 3-Month Spike In Last 5 Years
Data shows that Bitcoin mining hashrate recently recorded its third biggest 3-month increase in the last five years.
Bitcoin mining hashrate has risen sharply recently
As an analyst of twitter pointed, only the aftermath of China’s 2021 ban and the 2019 bear market saw faster increases. The “mining hashrate” is an indicator that measures the total amount of computing power that miners have connected to the Bitcoin blockchain.
When the value of this metric increases, miners are bringing more machines online on the BTC network now. Such a trend suggests that the blockchain is currently attractive for mining these chain validators.
On the other hand, the falling value of the indicator implies that some miners are disconnecting their rigs from the network. This could be a sign that the average miner is not finding BTC mining as profitable these days.
Now, here’s a graph that shows the trend in Bitcoin mining hashrate, as well as its 3-month percentage change, over the last few years:
The value of the metric seems to have been quite high in recent days | Source: James V. Straten on Twitter
The chart above shows that the Bitcoin mining hashrate (the orange curve) has seen a sharp uptrend in recent weeks. Due to this exceptional and consistent growth, the 3-month percentage change in the indicator also soared.
According to this peak, the value of the metric has grown by about 52% in the last three months. This hashrate increase is the third largest BTC blockchain seen in the past five years.
The biggest in this period occurred after the 2018-2019 bear market, when the April 2019 rally took place. Many miners may find it unprofitable to mine the coin during bear markets. Therefore, the hashrate can decrease significantly as miners disconnect from the network.
When the rally in April 2019 came just after the worst part of the bear market, miners suddenly found it very profitable to mine the asset again, so they quickly rewired their machines, which is why the hashrate showed such a sharp jump.
The second largest 3-month upward adjustment occurred when the H2 2021 bull run began. Earlier that year, China banned Bitcoin mining in the country, which led to a mass migration of miners out of the country.
This migration can also be seen in the chart as a 3 month large negative change in the hashrate occurred in May-July 2021. When the miners finished their migration and set up their facilities again, the hashrate recovered.
Now the recent trend of the indicator is interesting. During the 2022 bear market, the hashrate saw only upward growth, although the price took a deep drop.
The likely reason behind this is that miners made huge profits in the 2021 bull run, so they drew up their expansion plans keeping them in mind, and the facilities took some time to set up, hence the positive growth in the mining market. low. .
Of course, the last sharp growth in the indicator probably came partly from this growth and partly because the last rally made mining profitable again.
At the time of writing, Bitcoin is trading around $26,900, down 4% over the past week.
BTC has plunged | Source: BTCUSD on TradingView
Featured Image of Dmitry Demidko at Unsplash.com, Charts by TradingView.com, Glassnode.com