Bitcoin (BTC) hash rate begins to recover as miners migrate from China
Bitcoin’s hash rate has been showing signs of recovery amid a gradual return of some Chinese miners, who have already moved some equipment outside of the country.
Upward hash rate trend
The BTC hash rate 7-day smoothed moving average chart demonstrates an upward trajectory that started in early July. For the past two weeks, the index has been fluctuating near the 100 EH/s level, well above the value it reached at the end of last month.
At the time of writing, the Bitcoin network has a hash rate of 102 EH/s, according to BitInfoCharts.
In July, the digital gold’s mining difficulty dropped by 4.81% to 13.67 T. The next recalculation of the indicator will take place in about two days. The value is expected to rise by 5.12% to 14.37 T.
Earlier, Bitfury Group estimated that after the de facto ban of cryptocurrencies in China, miners shut down equipment with a combined hash rate of 90 EH/s. The company estimates that the process of moving the mining devices will end in Q2 2022.
Impact on Ethereum miners in China
Despite the fact that China’s repressive policies have mainly targeted Bitcoin mining operations, widespread blackouts have also affected Ethereum miners. At the end of June, a month after reaching its all-time high, the second largest crypto’s hash rate shed 20%, tumbling below 500 TH/s.
In July, this figure began to recover. After reaching a local low, the ETH hash rate 7-day smoothed moving average demonstrates a reversal into an uptrend. At the time of writing, the average net hash rate is 526 TH/s, according to BTC.com.
The hash rate recovery suggests that at least some Chinese miners have successfully moved and reconnected their equipment back to the network.
Earlier this year, BIT Mining Limited announced an agreement to buy 2,500 Bitcoin miners for $6.6 million (~£4.73 million), which will provide a 165 PH/s increase in capacity. It will transport the acquired equipment to Kazakhstan.
The company has also started Ethereum mining operations outside of mainland China with a hash rate of over 86 GH/s.
Speaking to The Block, Igor Runets, CEO of a Russian data centre operator BitRiver, noted that the company has signed contracts with Chinese customers to provide 150 MW of power as the blackouts began in China.
A little earlier, Bit Digital pointed out in its Q2 2021 financial report that it had shipped 14,500 ASIC miners to the US in the past three months. At the time, more than 20% of its devices were already based in the States, with another 44.6% in transit or awaiting installation.
Bitcoin’s hash rate has been on an upward trajectory since early July, which indicates that at least some Chinese miners have successfully moved and restarted their operations outside of the country. According to some experts the process of transportation and reconnection is expected to finish in the second quarter of 2022. The process of recovery will take some time, but we can already gauge the progress by observing the rising levels of cryptocurrency hash rates.
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