Bitcoin Hashrate Heading Towards 100E: the Relation Between Hashrate, Price, halving and security
Computing power does not determine the price of cryptocurrency, on the contrary, the price of cryptocurrency will affect the computing power. Recently, there a hot discussion about Bitcoin’s hashrate. Many people are looking forward to witnessing Bitcoin’s hashrate to break 100 EH/s.
Today, we’d like to talk about the relation between hashrate, price, halving and security.
The essence of crypto mining is to conduct hashrate operations, so computing power represents the number of hashing operations per second. For example, the Bitcoin’s hashrate is about to break 100 EH/s. In fact, the complete writing form of 100 EH/s should be 100 E Hash/s, which means that 100 E Hash operations can be completed in one second.
Above is the break-line chart of Bitcoin’s average daily computing power. You will find that the fluctuation of Bitcoin’s daily computing power is not small. For example, 101.23 EH/s on September 16, 88.96 EH/s on September 17, with a decline of 12%, and the overall increase or decrease of about 10% is very common. Why is that? As we mentioned above, the hashrate is the sum of all computing power. Does it mean that thousands of mining machines are switching on and off every day?
In fact, the hashrate can not be counted. What we see in the chart is not the actual computing power, but an estimate based on the difficulty and the time of the blocking. Difficulty, computing power together with luck will affect the time of blocking.
The luck of the whole network fluctuates greatly on the 24-hour scale, so the average daily computing power of a day has not much reference value, so we must take a dimensional view of the computing power to reduce the deviation brought by the luck. That is to say, the average seven-day computing power may have exceeded 100 EH/s, but the average daily computing power has not yet broken.
For Bitcoin or all POW-based cryptos, security does not depend on the hashrate, but on the cost of 51% attacks, the higher the attack cost be, the safer the network will be. The current increase in Bitcoin’s hashrate means that the requirements for 51% attacks on the network are correspondingly increased, but this does not mean that the cost of 51% attacks has increased, because the unit cost of computing power should be taken into consideration.
There is no direct relation between hashrate and price. Hashrate does not determine price. On the contrary, price will affect hashrate. When the price rises, the miners’ profits are enlarged, which will attract more miners to join, thus increasing the hashrate of Bitcoin. The cost determined by the price of Bitcoin, the price underpinned by the cost.