Bitcoin hash rate drops 45% from 2020 peak

The Bitcoin network hash rate has dropped dramatically and is currently down nearly 45% from its 2020 peak. According to Blockchain.com, the network’s hash rate dropped from 13.62 billion Exahashes per second on March 1 to 7.5.7 Exahashes per second today, March 26. Coin.dance, another analysis site for the Bitcoin blockchain, revealed a similar pattern, even if it’s less pronounced.

The Bitcoin network hash rate has dropped dramatically and is now down nearly 45% from its 2020 peak.
According to Blockchain.com, the network’s hash rate has dropped from 13.62 billion Eh/s on March 1 to 7.5.7 EH/s today, March 26.
Coin.dance, another analysis site for the Bitcoin blockchain, reveals a similar pattern, even if it is less pronounced. The site reports that the 2020 peak was around 150 EH/s on March 5, and fell to 105.6 EH/s today, a 29% drop.
Hash Rate and Difficulty The hash rate of a cryptocurrency is a parameter that measures the number of calculations a given network can perform per second.
A higher hash rate means more competition between miners to mine new blocks; it also increases the amount of resources needed to carry out a 51% attack, making the network more secure.
Amid recent global turmoil, Bitcoin experienced dramatic losses in mid-March, with losses of up to 60% bringing the coin price to around $3,600, but yesterday the network difficulty dropped by nearly 16%.
The difficulty, or how computationally challenging it is to solve and verify blocks on the blockchain, will be set to adjust every 2,016 blocks, or every two weeks, to maintain a consistent ~10-minute block verification time.
This is closely tied to the network’s hash rate. Typically, when the network sees lower participating mining power, the difficulty decreases, while during periods of high participation in the network, the difficulty rises, acting as a balancing mechanism.
As reported yesterday, the last downward adjustment in difficulty was on February 25 of this year, when the coin was priced at around $9,900. Just three days later, the price dropped to around $8,800, and by March 14, it had fallen to nearly $4,800, and as low as $3,600 on some exchanges, as mentioned above.
The relationship between price, hash rate and difficulty has long produced a trend that some analysts have dubbed the “miner capitulation cycle.”
The theory posits that while Bitcoin prices remain high and mining is profitable, both hash rate and difficulty continue to rise until a threshold is reached where miners are squeezed and forced to liquidate more and more assets to cover their expenses – resulting in an increase in the supply of Bitcoin on the market.
Nowadays, as we are seeing today, a “capitulation point” occurs where some people can no longer afford the full cost of continuing mining, resulting in a drop in hash rate (reflecting lower participation) and a subsequent reset in the network’s difficulty.
According to btc.com, Bitcoin’s difficulty is currently forecast to decrease by a further 16% within 14 days.

Source: Cointelegraph