Although the price of bitcoin still leaves a lot to be desired, bitcoin seems to be fully recovering in another area. The available computing power on the bitcoin network is only 4% away from its all-time high.
Glassnode shares this, an analysis platform that focuses entirely on data from blockchains.
Computing power is security
Computing power is a proxy of how secure a network is, because the more computing power available, the more computers a potentially malicious party would need to tamper with the bitcoin blockchain.
Why is this interesting? Bitcoin’s computing power has been increasing almost continuously for years. Until last May, when China’s mining ban caused it to fall by 50%. How is this possible? Miners use their computing power to add new blocks to the blockchain, for which they are rewarded with bitcoin. It’s that same computing power that keeps the network safe from attackers.
Increase of 93%
When China introduced a ban on mining, the bitcoin price also in one. The market has since become more stable and bitcoin has even reached new highs. Chinese miners have been able to move to other countries and new miners have also been added, increasing the computing power by 93% again.
#Bitcoin hashrate has almost completely recovered, sitting only 4% below the ATH (7-day moving average basis).
Network hashrate fell by over 50% in May following China’s ban on #Bitcoin mining
Hashrate has since climbed by 93% from the lows, hitting 172 Exahash/s today. pic.twitter.com/nGd2uDhutX
— glassnode (@glassnode) December 7, 2021
What does Glassnode mean?
Bitcoin hashrate has almost fully recovered and is only 4% below the ATH (7-day moving average). Computing power fell by more than 50% in May following the Chinese ban on Bitcoin mining. Hashrate has since risen 93% from lows, reaching 172 Exahash/s today.”
This does require some explanation. Hashrate is the same as computing power and it is expressed in hashes. Currently 172 exahashes are executed per second. Exa stands for trillion and has 18 zeros.
Because these numbers are so incredibly high, but can also change quickly, we look at the 7-day moving average. The orange line in the graph in the tweet above shows this average.
Does China secretly want the best with bitcoin?
These figures prove that China’s control of the market is close to zero. A large part of the mining companies were previously located in China, which gave the illusion that China also had a lot of control over bitcoin. Now that they have killed that market with their own hands, they have also relinquished all theoretical power.
In hindsight, China’s ban is a blessing, as bitcoin has never been so decentralized. It also saves only 4% to be able to say that bitcoin has never been so safe.
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