Bitcoin Hashrate in Recovery Mode as Price Holds Key Support

Technology

Bitcoin Hashrate in Recovery Mode as Price Holds Key Support – Crypto News

Published

1 year ago

January 28, 2024

Dripp

Bitcoin hashrate is recovering from the lowest level it touched as of January 22 when it slumped to 479 EH/s. This recovery has coincided with many network events including the consolidation ongoing in the price of the top coin.

Trends in the Bitcoin Hashrate

Bitcoin hashrate is the network metric that defines the difficulty in generating new Bitcoin tokens. The higher the hashrate, the more difficult generating the coin is, and beneficially, the more secure the Bitcoin network is for everyone.

The Bitcoin hashrate is historically billed for a regular uptrend as more miners plugging new systems into the ecosystem helps increase the hashrate. The Bitcoin hashrate has been largely erratic since the start of the year opening up in January with a 516 EH/s reading. This figure soared to a high of 549 EH/s on January 6 amid bullish sentiment that surrounded the anticipation for a spot Bitcoin Exchange Traded Funds (ETF) product approval at the time.

This impressive surge returned to the 516 EH/s reading on January 12 before it made a move to its local high of 547 EH/s on January 17. From here, it dropped to its lowest level at 479 EH/s on January 22 from where it now returned to its peak at the time of writing.

The Bitcoin hashrate might shun its constant fall offs in the near future as Miners are poised to plug in tons of BTC miners in hope to catch a piece of the pie ahead of the forthcoming Bitcoin halving event.

Impact on Bitcoin Price

The growing network difficulty has a very subtle impact on Bitcoin’s price action. This current recovery comes at a time when Bitcoin charted a growth course from a low of $38,672 to a high of $41,968.66 at the time of writing.

Now that Bitcoin is exposed to institutional investors through the approval of spot Bitcoin ETF by the United States Securities and Exchange Commission (SEC), maintaining a healthy network outlook can serve as a Vote of Confidence to the investors per the blockchain’s security.

This confidence can help sustain the acquisition of Bitcoin by these large institutions and this can have a subtle impact on the price of the asset. With the outflow from Grayscale Bitcoin Trust (GBTC) slowing down, this can also help bolster the price of the underlying by a very large margin.