Bitcoin [BTC] hash rate recovers after Chinese exodus

The hash rate securing the world’s largest crypto-asset, Bitcoin [BTC], saw a significant recovery as it climbed to levels last seen in mid-June this year. As of 15th August, the figures for network hash rate stood at 133.5 exa hash/sec. Over the past 24-hours alone, it was up by almost 11%. Since the 2021 low of just 68 exa hashes per sec [EH/s], the hash rate has grown by over 95%, according to the data compiled by BitInfoCharts.

The hash rate fell drastically after cryptocurrency mining restrictions intensified in China, forcing domestic Bitcoin miners to shift their bases to crypto-friendly nations such as Canada, Kazakhstan, and the United States. The abrupt departure of miners from the grid resulted in the network hash rates slashing more than 60% from an all-time high of 180 exa hashes per second [EH/s] in less than two months.

Since then, several miners have resumed their activities, which was evidenced by the latest uptrend in hash rate after two months of laying low.

Bitcoin Difficulty Adjustment

Accompanying the Bitcoin has hash rate, the mining difficulty witnessed a considerable spike as well after an adjustment to 15.56 TH for the first time since the second week of June this year.

While the latest surge in difficulty is on the larger side, it isn’t really surprising. However, it is significant since it marks the first visible rise since the Chinese mining ban came into force. A 13.77% increase In the Bitcoin mining difficulty in two consecutive jumps, demonstrates a crucial trend that is currently underway – Chinese BTC miners are finding new bases elsewhere. The subsequent hash rate recovery further validated this thesis.

Besides that, according to several reports, the machines that were brought back online were the same ones that had been plugged in across China. Several miners in the country resorted to selling their equipment rather than moving their bases from China due to a variety of reasons from language barriers to capital constraints.