After hitting a low of 32 million TH/s, Bitcoin’s hashrate has seen a marked recovery in recent weeks indicating miners are showing renewed confidence in a Bitcoin price recovery.
CNR reported as recently as December 2018 that Bitcoin’s hashrate was dropping fast as the profitability of mining was so low that miners were being forced to turn off machines – sometimes permanently. As a result, the Bitcoin mining difficulty – which is recalculated roughly every two weeks – dropped significantly and profitability increased.
However, it seems we have turned a corner. Soon after the recent minor price recovery of Bitcoin, mining difficulty adjusted 10% upwards, breaking a months-long downward trend caused by the bear market. Newly available data shows BTC’s hashrate has risen over 35% from its recent low:
Bitcoin’s hashrate is up over 35% in the last 3 months.
November 2018: 32 million TH/s
Today: 43.5 million TH/s
Bitcoin is once again becoming profitable for more miners. pic.twitter.com/2L642jtq8K
— DRIVE Markets (@DriveMarkets) January 16, 2019
Bitcoin itself has been recovering from various sell-offs that saw its price drop from over $4,000 to about $3,500 although it’s since seen a minor recovery to $3,630. Regardless of these movements, the hashrate is holding firm – which suggests that miners think there is an imminent price recovery on the cards.
Research varies on what the breakeven price of Bitcoin is for most miners. Even with the latest ASIC mining hardware, profitability is still very much dependent on electricity costs, and many large-scale miners have located their operations near cheap electricity – such as geothermal in Iceland, hydroelectricity in the US and cheap coal-fired power stations in China and Mongolia.