The Bitcoin network’s hashrate has recently hit a new all-time high of 74.5 million terahashes per second, after growing 109% year-over-year. The cryptocurrency’s previous all-time high hashrate was in late June of this year, at 68.6 million TH/s.
The cryptocurrency’s hashrate has likely been increasing as miners are betting on its future, with renewed confidence coming from this year’s rally, which saw BTC go from around $3,700 in early January to, at press time, around $11,250.
Miners are also likely betting on BTC as its halving event is expected to occur in May of next year. In the event, the number of generated bitcoin rewards per mined block will be halved, meaning it’ll go from 12.5 BTC per block to 6.25 BTC per block.
Historically, the price of the flagship cryptocurrency’s price has risen with halving events, just like that of other cryptocurrencies. Last month litecoin, a cryptocurrency seen as the silver to bitcoin’s gold, hit a 13-month high as its halving event is set to occur in August of this year.
It’s also worth pointing out that Bitcoin’s hashrate hit a new all-time high at a time in which decentralization is seemingly prevailing. According to Blockchain.com data, no mining pool currently controls over 20% of BTC’s hashrate.
In comparison, back in 2014 one single entity controlled over 51% of bitcoin’s hashrate, while last year Bitmain, through the BTC.com and Antpool mining pool, came close to 51% as well. Currently, both of these pools control little over 30% of the Bitcoin network’s hashrate.
It’s important no single entity manages to control 51% of a cryptocurrency’s hashrate, as with it they’re able to attack its blockchain and pull, for example, a double-spend attack. As covered, in January of this year Ethereum Classic (ETC) suffered such an attack, with crypto exchange Gate.io having to cover over $200,000 in losses for its users.
Mining pool who’ve in the past managed to control the majority of BTC’s hashrate have argued they’re economically incentivized not to attack the cryptocurrency, as they’d destroy trust in it, which would likely lead to bitcoin’s price crashing. In the cryptocurrency space, however, users tend to prefer not to have to trust a single entity.
Notably, the hashrate’s rise has been accompanied by growing usage of the Bitcoin network, which recently came close to a new all-time high. As covered, bitcoin transaction inputs and outputs have been growing steadily since last year’s bear market.