Bitcoin price might be suffering but Bitcoins’s hash rate is going strong. The network’s foundations are showing their strength as the Bitcoin hash rate has hit its all-time high.
2 January 2020 | AtoZ Markets – 2020 is already promising to become a great year for Bitcoin. With the imminent halving set to take place this year, the flagship crypto has already hit a new record. Its network hash rate once more topping the previous all-time highs of 2019. Data coming from multiple monitoring resources like Blockchain and Coin Dance indicate that the hash rate was higher than ever before on January 1, 2020.
Bitcoin hash rate on the rise
An accurate measure of the computing power that is devoted to authenticating the Bitcoin blockchain reveals that the hash rate spent a better part of 2019 in a constant growth cycle. The upward trend only leveled off for a short period in Q3 2019.
The strong hash rate indicates that Bitcoin is increasingly becoming an appealing proposition for miners. Reports suggest that more mining power results in better network security and robustness against any probable attacks. According to Blockchain, the rate surged to119 quintillion hashes per second (h/s) on Jan. 1.
Conversely, the Coin Dance figures are different with about 143 quintillions h/s recorded for the same date.
Markets are waiting
The reason for that data variation comes from the fact that it is impossible to measure the hash rate in real terms. Resources only can analyze recent network activity and from the data collected create an estimate of the expected hash rate.
In that context, what seemed to be an overnight 40% drop in hash rate in September 2019 was later attributed to the method used to calculate it. These records have further come independent of Bitcoin price action. In 2019, BTC price fluctuated between $3,100 and $13,800 but the hash rate trend kept rising.
What it means for Bitcoin price
So what does this mean for Bitcoin’s price outlook? Why does the growing hash rate indicate that a price explosion (to the upside) is likely on the horizon?
Well, the uptick in hash rate confirms that “miner capitulation,” which is when miners sell their BTC en-masse to keep their operations afloat, has ended and recovery has started.
According to the Hash Ribbons, an indicator tracking instances of miner capitulation, Bitcoin’s booming hash rate is signaling that now is a great time to buy BTC for the long run. While this may sound extremely arbitrary, “buy” signals printed by the Hash Ribbons have only taken place 10 times before in BTC’s history, preceding uptrends of thousands of percent.
Moreover, analysts and commentators like Max Keiser have also alleged that hash rate highs will eventually result in new Bitcoin price highs. At the time of writing, Bitcoin price is hovering around $7,100 down almost 3% over the three days that cover the hash rate record.
What do you think about the recent Bitcoin hash rate surge? Let us know your thoughts in the comments below.