On New Year Day, the Bitcoin (BTC) blockchain network achieved an all-time high hash rate of just under 120 exahash per second (EH/s). Both price and hashrate are considered connected, but the crypto market sees to stay in a lull, with BTC prices remaining low. The new record high hashrate occurred just before the BTC network’s 11th anniversary. With the massive jump in hash rate failing to show on the price, it has brought some crypto enthusiasts to doubt whether these two factors are connected.
A Small Introduction
Hash rate is one of the crypto community’s favorite topic of discussion. Hashrate, in short, is a quantification of the processing speed of a crypto mining rig. The hash rate is measured as the combined hash power that is used to mine cryptocurrencies. Many forms of crypto make use of this, the most famous of which being Bitcoin and Bitcoin Cash (BCH). Hashes aren’t measured in small quantifications, with a terahash being the smallest measure of 1 trillion hashes per second. Above that, a petahash is measured as a quadrillion hashes per second, with an exahash being a quintillion hashes per second.
To put things in perspective, single-unit mining machines achieve terahashes per second. More extensive facilities, like collaborative pools, produce petahash. Entire networks of single miners, facilities and pools all combined produce a yield of exahash per second. All the miners in the BTC network combined failed to produce a single exahash until January 2016. At the time, the milestone was monumental, and the BTC network achieving 119 EH/S on the first of January this year is only more so.
Similar to back in 2016, the BTC prices were on a low compared to previous success. When the BTC network achieved one exahash, BTC was trading at a measly $380. After the spike in hash rate, the price followed at a slow pace, creeping up to $700 per BTC in June of 2016. However, as the hash rate climbed up to 2 EH/s, the BTC prices stagnated in the $600-775 range.
To contrast to this, 2017 stands where both price and hashrate rose together, particularly in spring. Since spring to December 2017, both BTC and its hash rate skyrocketed in tandem with each other, climbing ever higher. 2017’s April led to an overall hash rate of about 4EH/s, staying above 15EH/s by the end of that year.
In contrast, current circumstances have the hashrate climbing higher than ever before, with the price of BTC being a far cry from its nearly $20 thousand all-time high.
As of yet, the correlation between BTC and its hashrate is much like cryptid sightings: No one can definitively state that the connection exists, but denying it is just as tricky. It’s more than likely that the hash rate and price are connected in some other way, but definitely not in some clear-cut fashion.