The Hash Rate Paints an Ugly Picture

As the bear market continues, the hash rate has reached an all-time high of 242 exahash per second.

This is the equivalent of all 7.75 billion people on Earth completing 30 billion calculations every second. It's an awe-inspiring number.

At the same time, Bitcoin prices are pushing to their year-to-date lows.

While the hash rate accelerating to all-time highs is a positive trend for network stability and security, the same can't be said for short-term price action.

Bitcoin mining is a marginal business where only the strongest survive.

The revenue being earned per exahash has been in a persistent downtrend -- we call this the hash price. This pressure squeezes miner revenues, and, eventually, inefficient miners begin realizing losses.

As these inefficient miners get culled off the network, they're forced to shut down and liquidate.

We saw a capitulatory period in June.

But if Bitcoin can't hold the current support zone and/or winter energy costs continue to rise, we could see a secondary capitulation event driven by mining sell pressure.

There's no other way to cut it: New highs in the hash rate while price slumps is an ugly look.

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Allstarcharts Team