New Bitcoin record: BTC hash rate climbs to next all-time high
Bitcoin has already hit an all-time high in price in 2021 – and now the Bitcoin blockchain’s average hash rate – or the total computing power dedicated to mining – has risen to a new all-time high of over 176 exahashes per second (EH/s) on Friday.
The increase in the hash rate can be explained by the growth of the Bitcoin price itself. Since miners receive BTC as a reward for discovering new Bitcoin Evolution blocks, the more the coin costs, the higher the miner’s return.
So when the price of Bitcoin goes up, miners have an incentive to do more computing.
Another factor is transaction fees – the second source of revenue for miners. Essentially, when trading volumes increase – which they tend to do in a bull market – so do transaction fees.
Combined with the bitcoin price, this makes mining even more profitable.
As CoinGecko’s data shows, the rise in the bitcoin price to $38,000 coincided with the rise in the hash rate on Friday.
Bitcoin is currently trading at around $37,700, while its hash rate has fallen below 165 EH/s.
What are exahashes?
Put simply, new blocks are discovered by solving mathematical puzzles on countless mining systems. Each individual sum of these calculations is called a hash, and the total hash rate represents how many of these sums are calculated per second.
For example, 176 EH/s means that 176 quintillions (that’s 18 zeros) of hashes are calculated every second across the Bitcoin network. By comparison, Bitcoin’s hash rate (Go to Plus500 Buy Bitcoin Guide) was around 120 EH/s in the early 2020s – that’s an increase of around 50% in just one year.
However, the increase in hash rate does not make the discovery of new blocks any faster. This is because the rate of one block every 10 minutes is hard-coded into the Bitcoin blockchain and has remained largely the same over the past 12 years.
To maintain this rate, the Bitcoin network automatically adjusts its difficulty on a regular basis. In this way, the process of discovering new blocks only becomes proportionally more difficult, even when there is a massive influx of computing power.