Bitcoin hash rate spikes
Analysts speculate that the Bitcoin hash rate, the so-called Bitcoin hash rate, has seen a significant increase recently as miners come back online to reap the rewards of the increased
price of BTC
The Bitcoin hash rate increased to record levels of 398 terahashes per second (TH/s) on March 23, with analysts speculating that miners are starting to turn their rigs back on as BTC’s price rises.
According to data aggregator YCharts, the Bitcoin network hash rate dropped to 344.63 TH/s on March 27, up from 335.32 TH/s on March 26, but still up from 178.77 TH/s a year ago.
In a March 26 post, Sam Wouters, an analyst at service provider River Financial, speculated that the increase in Bitcoin’s hash rate is linked to unused mining stocks coming online, new facilities going live, and entrepreneurs finding cheap mining sources.
“While Bitcoin’s price was so low and as much inventory as possible was brought online last year, at some point the maximum capacity of what the network could handle was reached,” he said.
“Now that the price has risen again and some time has passed, more of this stock has been able to go online,” Wouters added.
In addition, Wouters says that Hydro models are starting to enter the market with “250+ TH/s per machine, which is a tremendous hash rate.”
An analysis by investment banking firm Stifel on March 20 shared a similar view, speculating that the latest spike could be linked to miners bringing back hardware online.
“We expect that the overall hash rate of the network will continue to climb higher as a result of attractively priced hardware being bought up by well-capitalized miners.”
Nazar Khan of Bitcoin mining company TeraWulf explains that the company is currently maximizing its hash rate for all its rigs and has recently brought more online at its new Nautilus Cryptomine facility.
“Wulf has the opportunity to add 80 MW of capacity at LMD and 50 MW at Nautilus. The recent price movement is an indication of the long-term value of the ability to expand on low-cost energy sites.says Khan.
According to Khan, while some have speculated that the lower prices forced miners to shut down their rigs and wait for the BTC price to improve, TeraWulf was able to continue mining Bitcoin at lower price levels due to their lost costs from “efficient mining fleets.”
But whatever the reason for the spike, Khan says TeraWulf does not expect the network’s hash rate to continue to increase in the first half of the year, regardless of the BTC price.
“There is a delay between when investment decisions are made and when that capacity comes online” explained Khan.
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