When China was having an intense Bitcoin crackdown, which included any crypto activities like trading and mining, Bitcoin’s mining hashrate dropped to 58.4 million terahashes per second. This massive decline was because many miners went out of business due to China’s anti-crypto policy.
Bitcoin Hashrate Recovers
However, new data by Glassnode revealed that the hashrate has officially fully recovered from last year’s lows. It even reached a brand-new all-time high only two days into 2022. According to Glassnode’s data, the hashrate is now at 208 million terahashes per second.
For those new to the industry, Bitcoin hashrate refers to the computational power solely dedicated to minting new coins. Other than that, it’s also responsible for security and transaction verification within the network. When the hashrate is high, more miners are helping to secure the network. As such, some analysts believe this to be a bullish sign for the industry’s future.
Miner Relocation Is Not the Cause for Growth
Bitfury, a major crypto mining firm, revealed to Financial Times that the reason for this growth isn’t because of miners relocating their equipment from China. Instead, it’s because of “new-generation equipment coming online.”
This means that even though the relocation of miners to other regions like the US and Russia did play a part in keeping the industry afloat while China implemented strict anti-crypto policies, this recovery could be mainly because of miners looking for new alternatives.
Jason Zaluski, the head of technology at Hut 8 Mining Corp, further solidifies this view by saying that China’s ban merely caused “a geographic shift.” For example, although some Chinese miners have been having difficulty finding cheap energy to power their data centers, US-based mining firm Marathon Digital revealed that their mining could reach an all-time high by the middle half of 2022.
