Bitcoin’s Network Hashrate Plunges To 40% Flash Crash
A piece of shocking news was observed in the industry after Bitcoin’s network Hashrate was dipped to record low at 57,700,000 TH/S from 98,000,000 TH/S.
Within 14 hours, Hashrate dipped sharply to half of its previous value, which indicates that almost half of the security has been removed, which makes the network vulnerable to cyber-attacks.
An overnight fall in the network’s power also indicates that either single-player influences the major fragment of the network or a group of actors under a similar power network are sharing the wide chunk of the hashrate collectively.
Possible reasons behind the Crash
While exact reasons are unknown, but an assumption is that the sudden exodus of miners due to less profitability might be one of the significant reasons. The Profitability depends on various factors including BTC‘s stable price, the heavy cost of power bills, the resources used, mining difficulty, etc. The backlash of miners could be one of the crucial reasons for the crash.
What is Hashrate?
Hashrate/hashing /computing power is the parameter to measure the rate of the digital currency in the network.
Hashrate = No. of calculations/second.
More specifically, more the Hashrate, more the competition among miners for validation of the new blocks. More the number of miners leads to more security for the network; also, the increase in Hashrate leads to more mining difficulty.
The importance of Hashrate just cannot be ignored as it indicates the strength and security of the currency and consequently leads to more popularity of the digital currency too.
Now and then
Bitcoin has witnessed such acute downfall back in November 2017, when Bitcoin Cash had been introduced in the market. The miners were attracted to Bitcoin Cash and a steep downturn (50%) was observed due to their sudden exit along with slackened transactional time and acute price fall.
The current drop came as a shock as the Bitcoin network has been performing extremely well since December 2018. Despite the slight fluctuations, it marked a record high of 10EH/s last week.