Bitcoin’s Hashrate Hits New a All-Time High of 120 EH/s After Tripling Over Past Year

Francisco Memoria

The Bitcoin network’s hashrate has reached a new all-time high above 120 million TH/s, after tripling over the last 12 months, from around 40 million TH/s in January of last year.

According to data from Blockchain.com, Bitcoin’s hashrate has been growing exponentially over the last few months, as BTC miners are likely trying to mine as much as possible before block rewards are cut in half in May of this year.

Bitcoin's hashrate over past 12 monthsSource: Blockchain

Block rewards are set to drop from 12.5 BTC to 6.25 BTC in May in what’s known as the halving. Every 210,000 blocks, or about every four years, block rewards are cut in half on the cryptocurrency’s network, effectively reducing the rate at which new BTC enters the market.

The halving reminds investors of the cryptocurrency’s scarcity, and helps ensure its inflation rate is stable until all 21 million bitcoins have been mined. Data shows there are now 18.15 BTC in circulation, which means most bitcoin has already been mined.

Some analysts claim bitcoin miners are deploying as much hashrate as possible to compete for the BTC left to be mined ahead of the halving, as if prices don’t increase their revenue will simply be cut in half. More hashrate means BTC’s network is more secure, as more computational power would be needed to alter the blockchain.

Bitcoin's price over past 12 mothsSource: CryptoCompare

It’s worth noting reports suggest two-thirds of the Bitcoin network’s hashrate come from mining facilities located in China, which is a major mining hub thanks to its cheap electricity and favorable climate.

Bitcoin has been through two halving events in the past. The first one, on November 28, 2013, saw the cryptocurrency’s block rewards drop from 50 BTC to 25 BTC, and the second one, on July 9, 2016, saw its rewards drop to the current 12.5 BTC.

Historically, bitcoin’s price has increased after every halving. While some believe the supply drop is already being priced in, others like hedge fund manager Charles Hwang predict BTC’s price will hit $100,000 during the next rally caused by the upcoming halving.

Featured image via Unsplash.

Morgan Creek Digital's Anthony Pompliano Explains Why He Is So Bullish on Bitcoin

Siamak Masnavi

On Tuesday (February 25), Anthony Pompliano (aka "Pomp"), a co-founder of crypto-focused asset management firm Morgan Creek Digital Assets, gave an interview -- to CNN's Julia Chatterley -- during which he extolled the virtues of Bitcoin.

Pomp focused on two main aspects of Bitcoin:

1. Bitcoin's Proof-of-Work (PoW) Consensus Mechanism and Its Energy Costs

He told Chatterley that Bitcoin is "the most seure computing network" in the world, and "it is going to take electricity or power consumption in order to power that security."

However, he said we don't need to get too alarmed by this since Bitcoin miners are "financially incentivized" to "find the cheapest power sources" because "that's how they make money."

Then, he pointed out that the cheapest form of energy is renewable energy, and so that is what they will try to use to power their mining hardware. In fact, he said that based on the studies he has seen, 60 to 80 percent of the energy being used is renewable.

2. Bitcoin's Store of Value Use Case 

"I think that store of value is really important. You have to have store value before you can have medium of exchange. 

"The store of value comes down to two things. One is security -- it can't disappear, it can't be hacked, etc.; and Bitcoin being the most secure computing network in the world, it is very secure...

"When it comes to price, what you want to see is, over long periods of time, either you're preserving your wealth, so the price stays flat, or it continues to increase.

"The monetary policy of Bitcoin relies on one thing: supply and demand economics -- artificially capped supply, demand increases, price will go up in U.S. dollar terms. And so, again, if you zoom out, over last decade, it's the best performing asset, over the last 12 months, up 150%, in the last you know what six weeks or so, it's up 30% or so.

"It's continuing to do exactly what it's kind of built to do. Now, there's high volatility on an intraday basis... but again people who put their wealth... in Bitcoin have been rewarded very well with this store of wealth thesis. And so we tend to think that the non-correlation with traditional assets will continue to be a valuable kind of aspect of Bitcoin."

Other Bitcoin-Related Topics

Pomp also responded to legendary billionaire investor Warren Buffett's most recent criticisms of Bitcoin by saying that although Buffett is "one of the best investors of all time," when it comes to technology, there are "better people to listen to." 

Finally, with regard to central bank digital currencies (CBDCs), here is what he had to say:

"These central back digital currencies are all coming, and really what I think people need to understand is all of the central back digital currencies are simply taking the existing monetary policy and changing the technology form factor.

"What Bitcoin does is it actually is a different monetary policy. It's not a fiat inflationary type model, and so ultimately we're going to have as a competition of currencies, but it's not going to be a competition on technology...

"We're going to have a competition of monetary policy... We believe that the Bitcoin monetary policy is superior to central bank monetary policies, and ultimately Bitcoin will be the winner, and will be the next global reserve currency."