The Bitcoin network recently reached the highest hash rate it has ever been, 98.5 quintillion hashes per second. That is 8 times the highest hash rate in 2017 when Bitcoin reached a record high of $20,000. What this means is that the network is able to process transactions 8 times faster than it did at the price peak of 2017.
Mining difficulty, the measure of how much effort must be put in to solve the mathematical problem that releases new Bitcoins, has also reached its highest ever at 11.9 T. This means Bitcoin is more secure today than it has ever been since its creation in 2009. These are two major parameters of the Bitcoin network that determine the state of the network.
What it means
An increase in hash rate means an increased ability of the network to process transactions. Traditionally, this means there is increased participation of miners on the network, it gives it more validity. Not just that, it means there is greater efficiency with the mining of new Bitcoins.
Traditionally, an increase in Bitcoin’s hash rate has led to a proportionate increase in price. This is why the cryptocurrency community is asking if Bitcoin is soon to rise following the new highs in hash rate.
Even more interesting is the fact that this is a high that has never been recorded before. By logic, one would imagine that the price should rise 8 times that of 2017 just like the new hash rate, but all fingers remain crossed to see what happens.
Meanwhile, a number of Bitcoin bulls have already pointed to a price increase following the hash rate. Binance CEO ‘CZ’ for instance stated in a tweet:
“Hashrate increase means more miners are investing in BTC, they are bullish. You know what follows?”
This is the question, and another Bitcoin bull, Max Keiser gives us an insight in a separate tweet. He said price follows hash rate and all things being equal, his short term $28,000 prediction is in play, probably showing up soon. The question remains when the price movement starts.
Bitcoin yet to react
It sounds very promising for Bitcoin that a historically key determinant of its price has risen so impressively. The asset is however yet to respond to the hash rate record. Bitcoin has been moving sideways with no impressive move in the last few months. It has even dipped from its former $10,300 to $10,200 at the time of writing this article.
Certainly every enthusiast, holder, and investor is looking forward to the price move. Not just that, a new all-time high is being awaited as Keiser doubles down on his short term $28,000 price. Will the new price happen in 2019 or do we look forward to 2020?