A recent decrease in Bitcoin's global hashrate has sparked discussions in the crypto community, with many linking it to military actions by the US in Iran.
Factors in the Decline of Bitcoin Hashrate
Bitcoin's hashrate has decreased to 753.81 EH/s from 943 EH/s recorded in mid-June. The drop happened shortly after US airstrikes on Iranian nuclear sites. This shift caught crypto market participants off guard. The hashrate indicates the computing power securing the Bitcoin network, and its decline typically suggests that some miners have gone offline.
Iran's Role in Bitcoin Mining
Iran is one of the major players in Bitcoin mining. Mining was legalized in the country in 2019, and licenses were issued to operators. Iranian miners utilize low-cost electricity generated from fossil fuels and nuclear energy. The country once held a 4.5% share of global mining; however, this has now fallen to about 3.1%. The US bombings may have impacted power infrastructure near key mining facilities, contributing to the current situation.
Outlook on Hashrate Recovery
Experts note that the hashrate may not recover immediately. Unless further strikes hit power plants or internet infrastructure, miners may slowly return to operation. If the hashrate continues to decline, the Bitcoin network will automatically lower its difficulty to maintain transactions every 10 minutes. Historical instances, such as the ban on mining in China in 2021, show that the network rebounded within a few months.
The drop in Bitcoin's hashrate raises serious questions about the impact of external factors on crypto mining, especially under conditions of international tension.
