Bitcoin mining has experienced a significant uptick in activity, as indicated by the rising Bitcoin Hashrate, signaling an expansion in mining operations.
The term “Hashrate” refers to the total computing power that miners contribute to the Bitcoin network. This metric is instrumental in assessing the sentiment of network validators. An increase in Hashrate suggests either new miners joining or existing ones expanding their operations. This trend signifies that mining looks profitable to these participants. Conversely, a drop in Hashrate might indicate some miners are disconnecting due to profitability concerns.
Recent data highlights a sharp increase in the Bitcoin Hashrate last month, setting a new all-time high (ATH). Concurrently, the price of Bitcoin also surged. Miners, who derive revenue from the block subsidy and transaction fees, are highly influenced by Bitcoin’s market price. Typically, block subsidies account for the bulk of miner income. A chart provided by on-chain analytics firm Glassnode illustrates the dominance of block subsidies over transaction fees.
According to the chart, Bitcoin miners have amassed a total revenue of $71.5 billion, with $4.2 billion stemming from transaction fees. A key feature of Bitcoin’s blockchain is that the block subsidy remains constant in BTC terms, varying only during Halvings, where it is halved every four years.
With the cryptocurrency’s USD value being the key variable, a rise in Bitcoin’s price logically results in increased miner revenue, reflected in the Hashrate. Interestingly, while Bitcoin's price continued to climb after last month's peak, the 7-day Hashrate witnessed a decline. However, the trend has reversed this week, challenging the previous ATH.
In parallel, Bitcoin price is approaching its own all-time high, surpassing the $102,000 mark.