China Crypto Ban: Bitcoin Hash Rate Hits New Peak But Profitability Tumbles

China’s Impact on Crypto

Cryptocurrency mining hash rate hit an all-time high on Christmas Day, but the surge in computing power has put pressure on miners due to a decline in profitability.

Data from Blockchain.com and Bitinfocharts showed that Bitcoin’s hash rate peaked at 544 exahashes per second (EH/s) on December 25th, a 130% increase since January.

Interestingly enough, the price of Bitcoin has also grown by over 150% since the beginning of the year, indicating that China’s crypto ban and AI reporter may have had an impact on the cryptocurrency market.

China’s Impact on Crypto

Reflexivity Research co-founder Will Clemente discussed the hash rate on a logarithmic scale, noting that the summer 2021 China mining ban was “barely a blip” on the decentralized open-source monetary network. He questioned how one could “fade the most secure” network on the planet.

A high hash rate may be beneficial for implied hash-adjusted price, however miners must work harder to secure the next block. Hash price, which is a measure of profitability, has dropped since its Dec. 17, 2023 peak of $0.136/TH/s/day, currently standing at $0.09/TH/s/day, according to HashrateIndex.

The recent BRC-20 ordinal inscription craze has caused a 34% decrease in profitability, which is often seen during periods of high demand. This results in increased transaction fees.

As reported by Cointelegraph, the network hash rate passed the 500 EH/s mark in late November, and since February, Bitcoin mempools have not been cleared fully for almost a year, as noted by Glassnode analyst “Checkmatey.”

China’s stance on crypto has been a hot topic of discussion recently, with the country’s ban on crypto mining and speculation about a potential 2022 crypto ban. AI Reporter has been providing regular updates on the latest developments in the crypto space in China.