Bitcoin computing power continues to rise, up 40% in 2019, close to historical highs

It seems that Bitcoin has seen a resurgence of interest as its price continues to rebound this year. The hash rate of the Bitcoin network has also been rising and is currently near an all-time high.

As of 9am today, data from Blockchain.com showed that Bitcoin's hashrate was about 48.00TH/s. However, on May 2, this figure reached 58TH/s, which means that the network hashrate has increased by nearly 40% since the beginning of 2019 and is only about 6% away from its all-time high.

Bitcoin network computing power (data source: Blockchain.com)

According to Blockchain.com, Bitcoin’s hashrate reached 60.09TH/s on September 24, 2018, before falling to 32TH/s on December 2, 2018.

The network hash rate (computing power) is necessarily related to the number of miners mining Bitcoin. More miners often result in higher hash rates. Hash rate is directly related to Bitcoin network difficulty, which increases as more miners enter the network. A decrease in hash rate means a decrease in mining profitability, causing miners to shut down their mining machines or choose to mine other cryptocurrencies.

Based on the current high computing power level, one might conclude that at least the industry’s interest in Bitcoin mining is rising. Mining is actually an investment in the future price of Bitcoin, which also shows that the industry is optimistic about the price of Bitcoin.

On the correlation between Bitcoin price and computing power

The price of BTC is also somewhat correlated with computing power. After all, when the price drops to a certain level, miners will not be able to make a profit, and may even lose money. After Bitcoin fell sharply from the $6,000 area last year, miners began to leave the Bitcoin network in large numbers.

Chris Derose of the Counterparty Foundation said a few years ago that hashrate could indicate the health of the network. Derose believes:

“ The hash rate shows how enthusiastically people are investing in the network, at least to some extent. ”

The day before yesterday, BTC's computing power surged by 16.102% to 51.786 (EH/s); correspondingly, Bitcoin Cash's computing power fell by 18.67% to 1.98776 (EH/s); Litecoin's computing power also rose by 4.55% to 0.00033 (EH/s).

The price trends of the three are also very coordinated. Yesterday, BTC fell 1.67%, Bitcoin Cash fell 10.67%, and Litecoin fell 4.73%. It can be said that the increase in computing power has a supporting effect on prices .

Uncle Miner believes that when the price rises, miners will switch their computing power to this coin, and the computing power of this coin will rise sharply; otherwise, it will fall sharply.

Of course, there are expectations. The more optimistic the miners are about the price of the currency, the more computing power they will invest and the more coins they will mine. Conversely, they will reduce computing power. The relationship here is more complicated, but generally there is a positive correlation .

The computing power of Litecoin has exceeded its previous high. Driven by the news of halving, the price has also risen sharply this year. It can be seen that miners' expectations for the price of Litecoin are still very high.

However, we can see that as the computing power stops growing, the price also starts to fall back , and there is indeed a positive correlation between the two. From a micro perspective, it is indeed unscientific to judge the price based on computing power, but from a macro perspective, there is indeed a correlation between the two.