The one-month implied hashrate on the Bitcoin network has seen a steady increase for almost four months since the beginning of 2021, reaching 166 exahashes per second (EH / s) in April. It shifted sideways during that month and the following, but began to fall sharply at the beginning of June. By July 1, the Bitcoin network’s hash rate had dropped nearly 30%, bottoming out at around 95 EH / s later that month. But since then the hashrate has recovered quickly, up over 30% in about 30 days, and started a V-shaped recovery.
The thriving computing power of the Bitcoin network began to decline when China began tightening regulations on Bitcoin mining in May. In less than two months, the provincial governments had already issued numerous closure orders and inspection notices to local miners who saw no other option but to leave the country for good. But since the great ASIC exodus, some farms started relocating overseas, bringing all of those banned miners back online and sparking a strong rebound in hashrate.
August was a key month for the Bitcoin network’s hashrate, with the 30-day moving average of the median hashrate currently at 120 EH / s according to CoinMetrics data. The “one month implicit hashrate is a more suitable metric to track medium to long-term changes in the hashrate of Bitcoin, as it filters out all the noise,” explained Lucas Nuzzi in his article for BitcoinMagazine. Since the large daily fluctuations in the hashrate expire, the implicit 30-day hashrate provides a clear overview of the direction in which the hashrate is developing overall. Right now it only needs to rise around 38% to hit its all-time high. The 7-day moving average, another popular hashrate metric, is currently at 130 EH / s – the highest since June.
In a true “V-shaped” recovery, the Bitcoin network’s hashrate has successfully passed a rigorous stress test showing it can recover from a ban by one of the world’s largest economies. Bitcoin is purely guided by market economy principles and is in fact anti-fragile and cannot be banned. Hence, the real winners will be the countries that embrace and embrace Bitcoin and its ecosystem instead of fighting it – and the sooner the better.