While we hodlrs may worry about the value of cryptocurrency being diminished, the hash rate just keeps rising – showing that crypto-miners are still confident.
Apparently, though the price of Bitcoin has suffered a fairly big fall in so far in 2017, it doesn’t seem to be putting of those mining it. According to a report by Forbes’ Naseem Aslam, even as the price of Bitcoin descended from the highs of early 2018, the number of miners on its network continued to increase – and is still increasing now – showing that, while public interest in the the cryptocurrency may have waned somewhat, and its market cap is now way less than half of what it was at its peak, miners remain committed.
Mining, of course, uses a lot of equipment and a lot of power, and miners are probably not inclined to spend money on such things were they not confident they would be reward. Thus, the article conclude: “Miners are in the business to make money and perhaps the downturn in this market will allow them to accumulate more bitcoin at lower prices in preparation for the next Bull Run.”
It makes an interesting case for considering hash rate as a fundamental aspect of the market for cryptocurrencies – that is to say that, the amount of time and energy devoted to solving the mathematics needed to update the blockchain and earn Bitcoin is both a reflection and a driver of its value. In a world where many people will concentrate on the technical side of markets – analysing graphs looking for patterns and movements that can hint why prices changed and where they may go next. It also makes the logical assumption that we should really only begin to worry about the health of a cryptocurrency when hash rates start to decline, meaning less resource is being dedicated to it.