The Bitcoin (BTC) network hash rate has just taken a steep plummet and is now downwards almost 45% from its 2020 summit.

The network's hash rate sank from 136.2 quintillion hashes per 2nd (EH/southward) on March 1 to 75.7 EH/southward today, March 26, according to data from Blockchain.com.

Coin.dance — another analytics site for the coin'due south blockchain — reveals a similar design, if less stark. The site reported a 2020 tiptop of roughly 150 EH/s on March five, today downwardly to 105.vi EH/southward — a 29% decrease.

Bitcoin network hash rate, April 19, 2019–March 27, 2020

Bitcoin network hash charge per unit, April 19, 2019–March 27, 2020, Source: blockchain.com

Hash charge per unit and difficulty

The hash rate of a cryptocurrency is a parameter that gives the measure of the number of calculations that a given network can perform each 2d.

A higher hash rate means greater competition amongst miners to validate new blocks; it also increases the number of resources needed for performing a 51% assail, making the network more secure.

Afterward a volatile month in which Bitcoin saw dramatic, if brusque-lived, losses of as high as 60% to around $iii,600 in mid-March, the network's difficulty yesterday decreased by close to 16%.

Difficulty — or how challenging it is computationally to solve and validate a block on the blockchain — is set to adapt every 2016 blocks, or 2 weeks, in lodge to maintain a consistent ~x-minute block verification time.

This has a close connection to the network's hash charge per unit. Typically, when the network sees a depression level of participating mining ability, the difficulty will tumble — while in periods of intense network participation, information technology rises, working as a counterbalancing machinery.

Every bit reported yesterday, the concluding down adjustment in difficulty was on February 25 of this year, when the coin's price was around $nine,900. Merely three days later, information technology dropped to around $8,800, and past March fourteen, to near $4,800 — and as low every bit $3,600 on some exchanges, as noted above.

Interpreting the data

Theis relationship between price, hash rate, and difficulty has historically generated a tendency that some analysts refer to every bit a "miners' capitulation wheel."

The theory holds that while Bitcoin's price remains high, and mining is profitable, both hash rate and difficulty inch upwards until they reach a threshold at which miners are squeezed and forced to liquidate more and more of their holdings to cover their expenses — leading to an increased supply of Bitcoin on the market.

The "capitulation bespeak" — at which some can no longer afford to continue mining birthday — then involves a decline in hash rate (reflecting lower participation) — as tin can exist seen today —  and a subsequent reset in the network's difficulty.

According to data from btc.com, Bitcoin'southward difficulty is currently forecast to decrease past a further 16% in 14 days' fourth dimension.