The bitcoin
hash
rate, or
the participation rate of bitcoin miners
in production, fell by 16% after the halving on May 12. Miners, who were rewarded with 12.5 Bitcoins for each block before the halving
, pulled the plug after the halving of this reward to 6.25 in order not to make losses, especially individual miners, as they had difficulty in covering their expenses due to electricity consumption.
Since the decrease in the hash rate reduces the speed of transacting with bitcoin, investors may not be able to process transactions as fast as before. It also caused block digging times to rise to over 10 minutes. However, as always, this situation will be rebalanced by adjusting the difficulty in block digging operations.
We have seen the hash rate rise to historic record highs with the participation of individual miners who knew before the halving that revenues were still attractive. It was expected by analysts that there would be a decrease in the hash rate after the halving took place. In fact, most analysts had expected the decline to be higher than 16%. Likewise, with the entry into the coronavirus process in March, the crypto money market as well as all the markets in the decline process on March 12, the bitcoin hash rate fell by 17%. Although it reached record levels before helving, the post-halving decline was less and remained at 16%.
At the end of 2017, bitcoin tested the $20,000 levels, and we know that there is a saying in the market “Not to forget the level it has seen.” Since the reward halving will reduce the supply of bitcoin in the market, we can predict that the value of bitcoin will increase in the medium and long term. Miners, whose revenues will increase with this, will be reactivated. This may mean that the hash rate increases again over time.
When we consider all these situations, we can predict that the decrease in the hash rate after the halving is not a worrying situation for the future. Likewise, the bitcoin market seems to be rebalancing after the halving and will continue its way from where it left off.
