An enormous Bitcoin hash rate represents a network with tremendous power, and that’s one thing analysts are looking at today as Bitcoin price continues to evolve beyond the $10,000 mark.
New reports show that Bitcoin’s overall hash rate has hit an astounding 80 quintillion hashes per second, in reference to the SHA 256 algorithm used to work on Bitcoin mining.
Why is the hash rate so important?
The Bitcoin network’s hash rate is a representation of how much power there is in the network – how frequently a machine performs an iteration on the processes used to mine Bitcoin.
Because Bitcoin difficulty adjusts to the network’s hash rate, a spike in hash rate doesn’t mean miners are able to conquer blocks more quickly.
What it means is that the system is inherently more decentralized, which protected against both internal and external threats.
A higher hash rate protects systems from the threat of hacking, as Wolfie Zhao infers at Coindesk in a piece June 27, discussing the amount of Bitcoin activity tied to Chinese hydropower.
“It’s important to note that this year, the arrival of the rainy season in China’s southwest has been delayed by nearly a month compared to previous years,” Zhao wrote. “As a result, some local mining farms were only running less than half of their total capacity in the past month.”
A higher hash rate also protects against the threat of a 51% attack, as explained by Matthew Beedham at Hard Fork.
“A high hash rate makes it more logistically difficult to coordinate the number of computers required for such an attack,” Beedham writes. “This is assuming that no one entity controls or owns a majority of the hash power of the network.”
With that said, the higher hash rate can generate better investor confidence.
Network strength in turn contributes to the overall bullish sentiment among Bitcoin proponents, who note that during the cryptocurrency’s all-time price high in December 2017, the same metrics were markedly lower,” wrote William Suberg at Cointelegraph this morning, assessing the situation.
Look for BTC to possibly climb on these sorts of sentiments.