The mining hashrate is a measure of the current amount of computational power expended to mine new blocks, which at the same time secures the Bitcoin blockchain and processed transactions on the network. The higher the number, the more computing power–and cost–would be required to take over the network.
Mining hashrate has been on a wild bull run this year. After hitting a low of 32 exahashes per second on December 2018—the network's hashrate has since tripled in the last 10 months.
In June this year, Bitcoin's hashrate initially broke above its last all-time high of 60 exahashes per second—that was first reached in August of 2018.
Experience Web 3.0.
Be the first to get Decrypt Members. A new type of account built on blockchain.
To cope with this demand, mining giant Bitmain has announced a new set of more efficient, air-cooled mining machines, designed to work in temperatures around the world.
It's a wise move considering how much people are willing to spend on mining machines. Litecoin founder Charlie Lee estimates that the current hashrate translates into around $2.9 billion worth of mining hardware. Using an estimated average electricity cost of $0.06 kWh (from Fundstrat analyst Tom Lee)—hourly electricity costs to keep the network online would be around $530,000.
That means Bitcoin miners are spending half a million dollars an hour to keep the network running. Which seems a lot but is still lower than the $750,000 that they can take home in block rewards (with transaction fees on top of that).
But with the block rewards set to get cut in half in May 2020, the booming hashrate's days are numbered.