Protection and stability. What does the Bitcoin hashrate depend on?

Hashrate is one of the main terms in mining. Therefore, today we will analyze not only its meaning, but also tell you what it depends on, how to recognize it, calculate it and increase it.

So, what is hashrate in mining?

HashRate is a unit of measurement for the power of mining equipment. The higher it is, the greater the computing power, which means your farm will be able to perform more calculations and thereby generate more profit.

What is a hash?

Now let's look at everything in more detail, and start with defining what a hash is. So what is hashing? Hashing (from the English Hash - confusion) means turning an input data array of any length into an output transformed string of a fixed length. Translating this into cryptocurrencies, transactions in any currency system such as Bitcoin are taken as input and converted through a hashing algorithm (SHA-256) which produces a fixed-length output string. For example, we have a text file. We see it as text, but the computer sees it as a set of characters. Computer logic uses the binary system (zero and one), which can be converted to hexadecimal. By applying hashing to this text, we can convert it into a string that will have a fixed length according to the SHA1 hashing algorithm.

As you can see, no matter how big or small the input data is, the output will always be a fixed length. This way, instead of storing a huge amount of incoming data, you can simply store a specific hash.

Is it possible to increase the hashrate?

Yes, it's possible to do this. Initially, the equipment is configured to work with hashing as stably as possible. It is not profitable for manufacturing companies to squeeze the maximum out of their video cards. They provide a warranty on their product and promise to repair your broken video card or ASIC for free. Therefore, it is in the interests of the manufacturer to ensure that nothing breaks.

Miners have a different interest - to squeeze out maximum profits. If the equipment is already under warranty, why not use it to its fullest? If you change the factory settings and optimize the farm, you can artificially increase your hashrate. You can find how to do this on other sites on the Internet. Let's not dwell on this now.

However, it is worth considering that artificially increasing productivity not only accelerates wear, but also causes overheating. So you will have to think about an additional cooling system. There is no need to try to optimize the farm if you are a novice miner. This is an unnecessary risk.

A safer way is to install the HiveOS operating system. It is designed specifically for cryptocurrency mining. In this case, the efficiency will increase, but you will not be able to use the computer for personal purposes (however, even when mining on other operating systems, it is not advisable to touch the computer again).

What other technical characteristics affect the hashrate of equipment?

When choosing equipment, it is important to consider not only its gross power. Also important:

• Economical (electricity consumption). To calculate the efficiency of a video card, you need to divide the consumption (W) by the hashrate. The lower the number, the better.
• Memory size. The higher it is, the better. Especially when it comes to top cryptocurrencies. Processors with 4 GB memory can already be considered obsolete for Ethereum mining. Optimal - 8 GB. The most modern ones have 16 GB of memory.
• Payback period. Using the mining profitability calculator, you can calculate how many months it will take to pay off your investment in a mining farm. You need to subtract electricity costs from your total monthly income and divide the cost of the equipment by what you get. On average, a period of 2-3 years can be considered normal, but much depends on the exchange rate.
• Guarantee. Does the manufacturer provide a warranty for repair or replacement? If a company is ready to replace your failed GPU with a new one within six months or a year, or at least repair it, this is very convenient.

What is hashrate?

Mining ability is measured by the number of attempts the miner's hardware sends to find a hash (transform a block). With each attempt, a so-called candidate block is created that must match the established hash. Since attempts are sent continuously, mining power is measured in attempts per second [H/s].

The more people with their equipment take part in the mining process, the higher the hash rate. If the hashrate is too high, the difficulty level increases. If the hashrate becomes too slow, the difficulty level decreases.

Hashrate designations:

What does Hashrate affect?

Miners keep the blockchain running. To do this, they use equipment that searches for blocks by brute force encrypted data. To mine a block, you need to find a hash value that is less than or equal to the 256-bit sequence. Theoretically, a mining rig can guess the correct value on the first try, but there are so many possible options that the chances are simply minuscule. Therefore, you have to iterate through many values.

In different cryptocurrencies, searching for a block takes different times. For Bitcoin it takes on average ten minutes, for Ethereum it takes less than 20 seconds. If at any point miners start finding a block too quickly, the network and hashing difficulty automatically increases. Also, Bitcoin automatically undergoes a halving procedure (halving the block reward) every few years.

How is hash rate and its unit measured?

Hash rate is a unit measured in hashes per second or h/s, let's look at the values:

• 1 kH/s is 1,000 (one thousand) hashes per second
• 1 MH/s is 1,000,000 (one million) hashes per second.
• 1 GH/s is 1,000,000,000 (one billion) hashes per second.
• 1 TH/s is 1,000,000,000,000 (one trillion) hashes per second.
• 1 PH/s is 1,000,000,000,000,000 (one quadrillion) hashes per second.
• 1 EH/s is 1,000,000,000,000,000,000 (one quintillion) hashes per second.

Thus we get that:

• 1 MH/s = 1,000 kH/s
• 1 GH/s = 1,000 MH/s = 1,000,000 kH/s
• 1 TH/s = 1,000 GH/s = 1,000,000 MH/s = 1,000,000,000 kH/s

etc.

How to find out the hashrate of a video card or an entire mining farm?

Everything is quite simple. If you know the characteristics of each individual piece of equipment, you can add them together and subtract a few percent of the error. The processor will still not be able to concentrate one hundred percent on searching for the block and hashing, and will also waste resources on background tasks. But the larger the farm, the smaller this percentage of error will be.

A more accurate assessment can be made after the fact, when the farm has been operating for a month or at least two weeks. You can install a special program to calculate electricity consumption and the calculations made. If you mine through a pool, then everything is even simpler. Most pools, including Khashalot, have a Miner Statistics page where you can see all the reports.

How to calculate approximate profit using hashrate?

Profit is calculated by deducting expenses from income.
Income consists of daily payments, the size of which depends on the hashrate. To calculate your estimated income using the hash function, you will need to plug it into one of the calculators below (set all power values ​​to zero):

1. Bitcoin - for SHA-256

2. Litecoin - for Scrypt

3. Ethereum - for ETHASH (all power values ​​are zero)

4. DASH - for X11 (set all power values ​​to zero)

5. Zcash - for EQUIHASH (set all power values ​​to zero)

You can calculate profit for any currency you are interested in.

By entering the necessary data in the table, you will receive an approximate profit per hour, day, week. This will help you choose mining equipment or understand whether you should mine using your computer or rig.

Protection and stability. What does the Bitcoin hashrate depend on?

The main digital coin is like a living organism. Its work depends on many factors, one of which is of decisive importance

In July, the Bitcoin hashrate reached an all-time high of 79.7 EH/s; over the past six months, this figure has doubled, and since December 2022, when the coin was trading at a record high of $20,000, by eight times. The indicator that determines the total amount of computing power that is used to mine the first cryptocurrency is important for the normal functioning of the system.

The hashrate performs the function of immunity in the body of the cryptocurrency - it determines the security of the network at the moment. Now attacks on the blockchain of a coin and its transactions will cost a million dollars every hour, said LetsTrip founder Mikhail Khudokormov. Hundreds of millions of dollars will be required to “roll back several transactions,” and this is extremely unprofitable and makes no sense, the expert believes.

From the point of view of mining, an increase in hashrate leads to an increase in the complexity of the network, which means the profitability per device decreases, explained Dmitry Shuvaev, development director of the infrastructure mining company BitCluster. He added that the next important indicator that affects the profitability of devices is electricity.

“If the decline in the value of Bitcoin continues, then miners who place equipment in places with expensive electricity will begin to turn off their devices,” Shuvaev explained.

According to the specialist, this will lead to a decrease in hashrate and complexity, but an increase in profitability from each device.

In order for the network to remain secure, the Bitcoin rate must be above the breakeven point. When the price of a coin drops below or approaches this level, many cryptocurrency miners find it easier to turn off their equipment until better times, which is what happened at the end of last year.

By the beginning of December 2022, the Bitcoin hashrate dropped by 31%, and BitMEX exchange researchers linked this event to the shutdown of about 1.3 million Antminer S9 devices from Bitmain. At the same time, in November, entrepreneurs from China disconnected from 600 thousand to 800 thousand Antminer T9+ devices from Bitmain and AvalonMiner 741 from Canaan Creative. Then the asset rate moved towards a local minimum of $3,400.

Now the situation is completely different - it is almost impossible to purchase a miner at the price officially announced by the manufacturer, and you have to wait months for delivery, said Anton Makarchuk, marketing director of CryptoUniverse.io. He added that the hash rate characterizes the mood of the market as a whole.

The increase in the indicator also indicates that equipment manufacturing companies do not stop producing new miners. INNOSILICON, BITMAIN, Canaan and other market players are betting on developing production and increasing the efficiency of ASICs because they believe in the prospects of mining, the expert noted.

However, the indicator depends not only on the value of the cryptocurrency. The global trend of increasing hashrate in 2022 is also explained by the upcoming halving in the coin network, Khudokormov emphasized.

In his opinion, miners are now trying to get as much as possible before the reward for the mined block is reduced twice. The founder of Letstrip suggested that until May 2022, growth and increased security of the system are also inevitable due to relatively low transaction fees.

Drop in Bitcoin and Ethereum network hashrate due to mining ban in China

Information about the material Published: 06/29/2021, 08:54
The end of spring and beginning of summer 2022 in the world of cryptocurrencies will be remembered by everyone for the sharp redistribution of the mining market due to its ban in China, which, according to forecasts, accumulated more than 50% of the total hashrate of popular cryptocurrencies: Bitcoin and Ethereum. The peak values ​​of the BTC and ETH network hashrate were recorded at the end of May 2022: 643TH/s for Ethereum and 198Eh/s for Bitcoin. The Chinese government has begun to fight mining due to energy savings and the development of environmentally friendly production. And for this they need electricity from hydroelectric power stations, which was almost entirely spent on mining equipment. Since the ban on cryptocurrency mining in the Inner Mongolia region of China at the end of May and the largest mining region of Sichuan at the end of June 2021, the hashrate of both cryptocurrencies has been constantly falling.

As of June 28, 2022, the hashrate on the Bitcoin network had already dropped by a significant 70% to 58EH/s, and the hashrate on the Ethereum network by 33% to 434Th/s.

Graph of hashrate changes in the Bitcoin cryptocurrency network June 2021:

The level of hashrate on the Bitcoin network has dropped to the level of summer 2019.

Chart of hashrate changes in the Ethereum cryptocurrency network June 2021:

The hashrate level on the Ethereum network has dropped to March 2021 levels.

We can say with complete confidence that the Chinese mining market turned out to be much more than 50% of the global one and even more than 70%, because Only large farms in China are shutting down their mining farms.

But even taking into account the shutdown of only 70% of the hashrate of the Bitcoin cryptocurrency, the Chinese authorities will be able to redirect about 80 TWh to industrial production and primarily metallurgy, which use dirtier sources of electricity - coal power plants. Which will reduce the carbon footprint of their products in order to reduce the tax on their products in Europe after the introduction of an environmental (carbon) tax, which could be introduced as early as 2022.

The restoration of the Bitcoin and Ethereum networks may take quite a long time, because... No country in the world can offer the required amount of free electricity. For reference, China is the world leader in electricity production.

Top countries by electricity generation in the world:

*TW/h

But even if you find a site with cheap and accessible electricity, it will take more than one month to move 80 TWh or about 5,000,000 ASIC miners of the Antminer S19 level.

The first countries that began to accept refugees from China were Kazakhstan and the United States.

Such a global change in the main characteristic of cryptocurrencies, such as hashrate, did not go unnoticed in the cryptocurrency market, where the price of crypto assets corrected two or more times from the peak values ​​​​reached in May 2021.

• Cryptocurrencies