Bitcoin, arguably one of the two largest blockchains in the world, has kicked off 2022 with a new, all-time high in terms of its network hash rate. According to data from Cointelegraph and YCharts, Bitcoin scaled its highest ever hash rate at 207.53 Exahash per second (EH/s) on January 1.
The hash rate of a blockchain refers to the mining power, or the amount of computational power that a blockchain requires to ‘mine’ a unit or a part of its cryptocurrency token. Mining a blockchain’s token requires a series of transactions on the blockchain ledger to be validated, thereby bringing the token into public circulation.
The reason why hash rate is important is to prevent a blockchain’s token from becoming too easy to be mined. A low hash rate would allow more users to mine tokens, as it would require lesser computing power -- something that is available to more individuals. A higher hash rate, therefore, keeps a blockchain more secure and private.
Bitcoin, interestingly, saw a drastic fall in its hash rate in mid-2021, as a crackdown on cryptocurrencies by the Chinese government saw major Bitcoin mining rigs in rural corners of the country being decommissioned and put out of circulation in the blockchain’s scheme of operations. A report on the matter by CoinDesk stated that at this time, a staggering 46% of the world’s Bitcoin miners were based in China.
Reports have also stated that Bitcoin’s bounce back of hash rate is proof of the blockchain’s resilience. Miners of the world’s most commonly known cryptocurrency token migrated to other nations such as Iran and USA, and coupled with the rollout of the Bitcoin Taproot upgrade, underlined how the network has collectively improved its security -- while bringing more usable aspects such as smart contracts into its fold.
At the moment, Bitcoin hash rates are down by nearly 10% from its all-time peak, but even at around 190 EH/s, showcases how the blockchain has successfully increased its security through 2021.