Bitcoin Hashrate Recovers After Big Freeze That Halted Miners

The Bitcoin network hashrate has returned to steady levels, days after freezing temperatures across the United States strained the country’s power grid, causing the hashrate to temporarily drop.

In the days leading up to Christmas, freezing temperatures swept across the United States, leaving millions without power and killing at least 28 people.

According to reports, Bitcoin miners in Texas, which make up a significant portion of the country’s hashrate, have voluntarily reduced their operations to restore power to the grid, so residents can keep their homes warm.

The disruptions appear to have rattled Bitcoin’s hashrate, which typically hovers between 225 and 300 Exahashes per second (EH/s). This fell to 170.60 PE/s on 25 December.

However, as of December 26, the hashrate has returned to 241.29 EH/s, according to data from the CoinWarz hashrate mining calculator.

Bitcoin’s hashrate is calculated by measuring the number of hashes produced by Bitcoin miners trying to solve the next block. It is considered a key metric to assess the security of the Bitcoin network.

Recent events have sparked controversy statement from FutureBit founder John Stefanop, who suggested that the drop in hashrate was due to the simultaneous closure of a number of “highly centralized mines” in Texas.

“I know, it doesn’t change the fact that a few large mines in Texas affect the entire network by 33%…everyone’s transactions are now confirmed 30% slower because the hashrate isn’t quite decentralized,” he said.

“If the hashrate was distributed evenly around the world by tens of millions of small miners instead of a few tens of massive mines, this event wouldn’t even have registered on the network,” Stefanop added.

Bitcoin bull Dan Held however refuted Stefanop’s view of the events, arguing that weather conditions do not mean centralized ownership or control.

According to the Cambridge Bitcoin Electricity Consumption Index, the United States accounts for 37.84% of the average monthly hashrate share. The top four states in the country for Bitcoin mining are New York, Kentucky, Georgia, and Texas, all of which experienced power outages due to the winter storm.

However, Dennis Porter, the CEO of bitcoin mining advocacy group Satoshi Action Fund, told his 127,400 Twitter followers on Dec. 25 that while inclement weather, particularly in Texas, caused 30% of Bitcoin’s hashrate in the United States, the network “continues to function perfectly”.

Cheap energy and favorable mining regulations in Texas have led to a Bitcoin mining boom in Texas in recent months, which is now home to some of the largest mining companies in the world.

Among those Riot Blockchain, Argo, Bitdeer, Argo, Compute North, Genesis Digital Assets and Core Scientific – which recently received a $37.4 million bankruptcy loan to stay afloat.

Related: “There’s a lot less land to roam” – Why White Rock established off-grid mining in Texas

However, recent weather events have only added to the list of headaches for Bitcoin mining companies.

The bear market has plagued Bitcoin mining companies to the tune of $4 billion in debt, according to recent data.

Many notable US-based mining companies have also filed for bankruptcy in recent months, while many other companies are approaching near-insurmountable debt ratios that require immediate restructuring.

The tragic weather events have not impacted the price of Bitcoin (BTC) so far, which is currently priced at $16,826 – only down 0.27 in the last 24 hours.