Bitcoin’s mining hash rate soared to an unprecedented peak on Christmas day, reaching 544 exahashes per second (EH/s), as reported by Blockchain.com and confirmed by Bitinfocharts. This milestone, marking a 130% increase in hash rates since January, aligns with Bitcoin’s price surge, which has mirrored the upward trajectory, soaring over 150% since the beginning of 2023.
Reflexivity Research co-founder Will Clemente, analyzing the hash rate on a logarithmic scale, downplayed the impact of the 2021 China mining ban, stating, “The summer 2021 China mining ban is barely a blip.” He expressed confidence in Bitcoin as the most secure and decentralized open-source monetary network.
While a high hash rate may theoretically bode well for models like implied hash-adjusted price, it presents challenges for miners. The intensified computational effort required to secure the next block poses a conundrum for miners in the face of diminishing profitability.
Hash price, a key profitability metric, has seen a decline in the past week, dropping to $0.09 per terahashes per second per day, according to HashrateIndex. This represents a 34% decrease from its peak of $0.136/TH/s/day on December 17, 2023. The cooling of the BRC-20 ordinal inscription trend has contributed to this decline in hash price.
The sustained pressure on transaction fees, evident in the failure to fully clear Bitcoin mempools for almost a year, has been observed since February. Glassnode analyst “Checkmatey” noted the prolonged elevated fee pressure, emphasizing the impact on the network.
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Notably, the network hash rate surpassed the 500 EH/s milestone in late November, underscoring the continued growth and resilience of the Bitcoin ecosystem despite challenges in mining profitability.
