Why the Bitcoin Mining Hashrate May Not Be Out of Trouble Yet

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Bitcoin mining hashrate took a nosedive as a historic storm tore through several US states. This has seen power grids consolidate electricity to be able to provide residents with enough energy to heat their homes and some mining operations have had to be terminated to release more electricity. There has been an increase in hashrate since then, but the worst may not be over yet.

Bitcoin Hashrate takes a beating

Power grids across the United States came under immense pressure as the country recorded one of its coldest winters yet. Temperatures have dropped dramatically in various states, and the power grid has been stretched to provide enough energy to heat homes. As a result, a number of bitcoin miners decided to suspend their operations to release power, which affected the hashrate provided by the country.

By Christmas Day, the global hashrate had dropped nearly 40% from its Dec. 24 peak of 276 exahashes per second (EH/s) to 175 EH/s. However, there was a 39% increase in hashrate on the same day, bringing it down to around 244 PE/s.

BTC Mining Hashrate Sees Sharp Drop On Christmas Day | Source: CoinWarz

Since then, the hashrate has continued to oscillate day by day and has now fallen back to the level of 212 PE/s. This shows that while miners may have turned some of their machines back on, they can turn them off once more as the extremely cold weather persists.

How long will this last?

Judah Cohen, winter storm expert for Atmospheric Environmental Research, said the Arctic blast the United States is currently experiencing is expected to be short-lived and last about a week before temperatures begin to return to normal.

BTC Price Maintains Momentum Above $16,800 | Source: BTCUSD on TradingView.com

However, that still leaves a few days before it fully resolves. This is evidenced by the zig-zag recovery and declines in the bitcoin hashrate over the past two days following December 25. Miners who took their operations offline to help stabilize the power grid will likely leave them offline for a while until authorities are satisfied that the weather has stabilized. An example of this was back in July when Riot Blockchain had to shut down its mining machines in Texas as the state faced a heat wave.

Related Reading: Bearish Indicator: Bitcoin Volatility Hits All-Time Low

Given this, the bitcoin mining hashrate is likely to drop for a few more days before bouncing back. As for miners, given that Riot had received $9.5 million in energy credits for shutting down operations in July, it’s possible that some kind of reward will be offered to miners.

Featured image from Crypto News, chart from TradingView.com

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