Hash Rate

Hash rate is the total computational power being directed at the Bitcoin network at any given moment — measured in hashes per second. As of 2024, Bitcoin’s hash rate is measured in exahashes — quintillions of hash computations per second.

Hash rate is, in a real sense, the security budget of the Bitcoin network.

Here’s why. The cost of attacking Bitcoin — rewriting its history — is proportional to the hash rate an attacker would need to outpace the honest network. Higher hash rate means higher attack cost. Lower hash rate means lower attack cost.

Bitcoin’s hash rate has increased by several orders of magnitude since 2009 — from a few thousand hashes per second in the early days to hundreds of exahashes per second today. Every order of magnitude increase represents a proportional increase in the cost of attacking the network.

This is why long-term Bitcoin observers watch hash rate alongside price — and often consider it a more meaningful signal.

A rising hash rate with a flat price means miners are adding hardware and committing resources despite minimal current reward. That’s a signal of long-term confidence in the network. A falling hash rate might signal miner capitulation — miners switching off unprofitable machines — which can precede or follow price weakness.

Hash rate doesn’t move based on sentiment or social media. It moves based on physical hardware decisions — machines ordered, installed, or switched off. It’s a measure of real-world commitment to the network that’s harder to fake than price.

The price tells you what the market thinks today. Hash rate tells you what miners are betting will be true in two to three years — which is how long it takes to recoup hardware investment.

Tomorrow: what happens when all 21 million Bitcoin are mined?

— The Daily Bit