ETH hashrate drops 25% after suppression of Chinese mining
ETH’s hash rate dropped 25% after the mining crackdown in China, meaning the Bitcoin network isn’t the only victim as we can see in today’s latest Ethereum news.
The ETH hash rate has fallen 25% since its peak in mid-May, and this is a direct result of China’s crackdown on crypto mining that led to the relocation of mining operations. According to BitInfoCharts, the hashrate of the ETH network reached an ATH of 585.5 TH / s on May 20th. In the weeks that followed, it fell to a three-month low. The decline of 26% within six weeks is one of the steepest in ETH history. Just 40 days after the hashrate peaked, it fell 17% in just 10 days. According to data from Glassnode, this is the sharpest decline in ETH history in 10 days.
In the winter of 2018, the ETH hash rate fell by 57%, but also for several months. The hash rate is a measure of the computing power of the network that loosely correlates with the ETH price. As the asset increases in value, mining becomes profitable, drawing mining resources into the network and increasing the hash rate. William Foxley, editor-in-chief of BTC mining company Compass Mining, believes that GPU-based ETH mining is harder to prevent than large-scale ASIC mining for BTC can be found by the government.
China-based Sparkpool, the second largest mining pool ETH, has seen a hashrate of 305 drones since approval was granted:
“It will be interesting for the China-based Ethereum miners, who not only suffered from the reduced fees of EIP 1559, but now also from the geographic shift away from devices. Building a larger industry.”
The transition to ETH 2.0 and the proof of stake will eliminate all ETH mining, but ETH miners could face some tough months. In related developments, SCMP reported that all smaller hydropower plants are for sale on e-commerce sites in China. As the demand for cheap electricity dried up and miners moved to a friendlier climate, the cost of installing electricity fell. Most of the factories are located in southwest Sichuan Province, with abundant water supplying cheap electricity.
DC Forecasts is a leader in many crypto news categories, always striving for the highest journalistic standards and adhering to strict editorial guidelines. If you would like to share your expertise or contribute to our news page, please contact us at [email protected]