Data from the blockchain indicates that the Bitcoin hashrate has declined recently while the price of the cryptocurrency continues on a downward trend.
Bitcoin Hashrate and Mining Activity
The Bitcoin hashrate is a metric that tracks the total computing power miners contribute to the Bitcoin network. An increase in this metric suggests more miners are participating, indicating a healthy network. Conversely, a decrease implies miners are disconnecting, possibly due to profitability concerns.
The chart below illustrates the 7-day average Bitcoin hashrate over the past year, showing a recent decline after a brief recovery:
The miners’ income primarily depends on the BTC spot price as they receive block rewards that are influenced by the cryptocurrency’s value. Amid recent bearish market conditions, miners have downsized operations resulting in the decline in hashrate. However, an uptrend in price could reverse this trend.
Another indicator reflecting miner activity is the Miner Reserve, showing significant selling by miners recently, as illustrated below:
Miners withdrew a notable amount of BTC from their wallets, indicating potential financial strain in the mining community.
BTC Price Performance
Currently, Bitcoin is trading around $59,000, experiencing a decline of over 5% in the last week, as shown in the price chart below:
