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Data indicates that the public Bitcoin mining firms are planning to expand their hashrate by almost 50% till the end of this year. Arcane Research predicted the hashrate of Bitcoin on Oct 6, 2022 through a post. It must be noted that “hashrate” is an indicator that measures the mining ability of any machine connected to the Bitcoin blockchain.
Bitcoin Hashrate
In the recent post Arcane Research mentioned that “Bitcoin’s hash rate has soared simultaneously as the bitcoin price has remained relatively flat. The hashrate growth is likely caused by American miners returning to full production after a summer of periodically curtailing operations as part of their participation in demand response programs.”
While the total network hashrate stands for the total computing power pool currently online on the chain. The below chart indicates how the 7-day moving average value of this metric has changed over the past year:
Source: Blockchain.com
The Bitcoin mining hashrate has sharply soared up recently to about 249 EH/s, a new all-time high. The public Bitcoin Mining firms combined make-up for 54 EH/s, which imply as they contribute to 22% of the total network value of the indicator.
Arcane Research also writes about how the trajectory of the total hashrate may follow in the coming months. As per the post, the expansion plans of the public BTC miners may be studied as a proxy for the entire industry’s growth expectations.
Nevertheless, several factors at play won’t allow the hashrate to grow to its full potential. In which the first is miner revenue that is under stress right now due to the declining Bitcoin price and the rising network difficulty. Another factor is the ever-rising electricity prices around the globe that hinders mining profitability.
The next reason is the public miners who have rarely ever hit their growth targets and historically tended to overestimate their ability to get mining operations online.
An analyst at Arcane Research, Jaran Mellerud estimates Bitcoin’s year-end hashrate and explains the factors impacting it.
Factors that Impact Bitcoin Hashrate
The analyst explains the factors impacting Bitcoin hashrate and added as “The Some factors indicate that the hashrate will keep growing towards the end of the year. The public miners are expanding like never before, planning to plug in tens of thousands of mining machines by year-end.”
Mellerud further justifies in the post that “On the other hand, mining economics are under severe pressure due to the growing difficulty and the depressed bitcoin price. At the same time, miners all over the globe are hit by rising energy prices. These factors could potentially render some mining operations unprofitable, thus holding back the hashrate from its full potential. We will now go through all these factors before I give my 2022 year-end hashrate prediction in the end.”
Nancy J. Allen is a crypto enthusiast, with a major in macroeconomics and minor in business statistics. She believes that cryptocurrencies inspire people to be their own banks, and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning. She frequently researches, and posts content on the top altcoins, their theoretical working principles and technical price predictions.
