Bitcoin hash rate hits a new ATH
The excitement around Bitcoin's current pricing might be subdued, but there’s a buzz around the network's hash rate which keeps breaking new records.
This gap between the network’s security strength and its market price indicates that Bitcoin mining entities are eager to expand their computational assets, despite the shaky market and business landscape.
On-chain data analysis firm Glassnode points out that miner earnings have dipped notably since the peak of Bitcoin's value in March.
This reduction in revenue is largely attributed to the drop in Bitcoin's valuation coupled with the impact of Bitcoin's halving event in March, which reduced the block reward. Additionally, the income from Bitcoin transaction fees has plummeted.
Yet, the hash rate reached a new zenith of 693 exahashes per second (EH/s) on Sunday, maintaining a competitive edge in a financially strained scenario. Currently, to mine a block, an average of 338,000 exahash is required, mentioned Glassnode.
Interestingly, while these conditions would typically prompt Bitcoin mining companies to liquidate their BTC to offset expenses, on-chain indicators reveal a trend towards accumulating and retaining Bitcoin.
Marathon Digital, the foremost public mining entity, has openly declared its strategy to hold onto as much BTC as it can. It's even embracing convertible debt as a means to acquire more BTC, similar to the strategy by Bitcoin development giant MicroStrategy. This move signals a bolstered belief in direct Bitcoin investment over traditional mining operations.
Regarding Bitcoin's market performance, some on-chain indicators appear less promising: Bitcoin's net settlement volume is reverting to its annual mean, and the trading volume on centralized exchanges has dipped significantly below the annual average, indicating a reduced trading velocity, speculation, and demand for BTC.
Conversely, several esteemed investors like Bitwise’s CIO Matt Hougan and BitMEX’s co-founder Arthur Hayes are optimistic about Bitcoin's recovery post-September.
Hougan expresses that September typically records slow activity for both Bitcoin and stocks broadly, but anticipates that October and November will usher in strong performances for the asset.
