Over the past few days, the Ethereum hashrate hit a new all-time high, reaching a record high of 1.12 Phash/s for the first time.
Ethereum mining sets new record for the hashrate
According to daily data from bitinfocharts.com, the new record would have been touched on Friday 13, so the daily average exceeded 1.12 Phash/s.
According to hourly data from coinwarz.com, the hourly peak would have been almost 1.26 Phash/s.
It is worth noting that Ethereum’s hashrate has been rising since 28 March, whereas until 15 March it was more or less around 1 Phash/s.
In reality, except for relatively short periods of stagnation, it has been on the rise since July 2021, i.e. since the mining ban in China was lifted with the opening of new mining farms in other countries, and the price of ETH has been rising again after the crash in May last year.
In May 2021, a new record high had been reached, at around 690 Thash/s, then the collapse to 500 Thash/s at the end of June.
Thus last Friday’s new record is 63% higher than a year ago, and 125% higher than at the end of June.
The curious thing is that the current price of ETH, at around $2,000, is significantly lower than it was in mid-May 2021, when it hit new all-time highs at over $4,600.
So in one year, the price of ETH has more than halved, while the hashrate has increased by 63%.
Even more curious is the fact that at the end of June last year the price was practically the same as today, so since then the price of ETH has not increased, while the hashrate has increased by 125%.
However, this glaring difference is very easily explained by the fact that hashrate varies very slowly, while the price varies very quickly.
Comparison of hashrate levels and ETH price
For example, compared to May 2020, the price of ETH has increased by 900%, while hashrate by less than 500%. Thus, the current growth phase of Ethereum’s hashrate is the concluding phase of the long wave that began in late 2020 with the start of last year’s bull run.
In other words, the hashrate in the last year and a half has risen much less than the price, and is now slowly trying to recover.
However, all this may seem strange, since with the future transition to Proof-of-Stake, ETH will no longer be minable. This switch should take place in the next quarter and should be followed by a change to the Ethereum protocol. This update will make mining with Proof-of-Work no longer profitable, disincentivizing it completely.
However, besides taking advantage of these last few months of PoW to mine ETH as much as possible, it is possible that miners are looking to use the same machines to mine other PoW-based cryptocurrencies in the future.
Bitcoin generally requires more powerful machines, and uses a different mining algorithm than Ethereum, but there are still smaller cryptocurrencies for which it will be possible in the future to use the machines currently allocated to mining Ethereum.
The record set on Friday 13, the week of one of the worst recent collapses in the price of ETH, seems to suggest that miners are not at all frightened by this collapse. Instead, they believe in a bright future for holders of this cryptocurrency. Especially since the current profitability of ETH mining has fallen close to the lows of the past two years.