Bitcoin’s hash rate of $26,924 reached an all-time high of 398 terahashes per second (TH/s) on March 23, with analysts speculating that miners are starting to turn their rigs back on as the price of BTC rises.
According to data aggregator YCharts, the Bitcoin network hash rate fell to 344.63 TH/s on March 27, up from 335.32 TH/s on March 26 but still higher than 178.77 TH/s a year ago.
Sam Wouters, a research analyst at Bitcoin financial services provider River Financial, speculated in a March 26 post that the increase in hash rate is due to unused mining inventory coming online, new facilities going live, and entrepreneurs finding cheap sources of mining.
“While Bitcoin’s price was so low last year, and as much inventory as possible was brought online, at some point, the network’s maximum capacity was reached,” he explained. “With the price rising again and some time passing, more of this inventory has been able to go online,” Wouters added.
Furthermore, Wouters claims that Hydro models are entering the market with “250+ TH/s per machine, which adds tremendous hash rate.” A March 20 analysis from investment banking firm Stifel expressed a similar sentiment, speculating that the recent spike could be attributed to miners reactivating hardware. “We anticipate that the overall network hash rate will continue to rise as a result of well-capitalized miners purchasing attractively priced hardware.”
In an interview with Cointelegraph, Nazar Khan of Bitcoin mining firm TeraWulf explained that the company is currently maximizing the hash rate of all its rigs and has recently brought more online at its new Nautilus Cryptomine facility.
“Wulf has the option of adding 80 MW at LMD and 50 MW at Nautilus.” “The recent price movement demonstrates the long-term value of being able to expand at low-cost energy sites,” Khan said.
While some speculated that the lower prices forced miners to shut down their rigs and wait for the BTC price to rise, Khan claims that TeraWulf was able to continue mining Bitcoin at lower price levels due to their lost cost from “efficient mining fleets.”
Regardless of the cause of the increase, Khan says TeraWulf does not expect the network hash rate to rise further in the first half of the year, regardless of the BTC price. “There is a time lag between when investment decisions are made and when that capacity is operational,” Khan explained.