The Bitcoin hash rate, which refers to the computing power used to mine new blocks, has dropped 50% since its peak in May.
According to data from The Block’s Data Dashboard, the hash rate has dropped from 180 EH/s seen on May 14 to its current value of 90 EH/s.
Due to this decline, the Bitcoin hash rate has returned to levels last seen in May 2020. At the same time, the ratio, which significantly opposed the long-term uptrend, experienced its largest decline in history.
Why is the Bitcoin hash rate falling?
The main reason for the falling hash rate is seen as China’s pressure on Bitcoin mining, The Block reported. After the Chinese State Council meeting last month, regions across China began issuing notices urging miners to cease their activities. This led to a huge drop in China’s contribution to the hash rate.
Another effect was BTC, which fell from its peak price of $63,500 in April to its current price of $35,300. This has made Bitcoin mining less profitable.
Bitcoin hash rate isn’t the only Blockchain metric on the decline.
The number of daily transactions on the Bitcoin network has dropped to levels not seen since July 2018. According to the dashboard, only 200,000 transactions are processed per day (on average in the last seven days).
Although it returned to April 2020 levels, the number of active addresses on the network also decreased. The number of daily active addresses has dropped from 1.23 million to 765,000 per day, with far fewer new addresses being created each day.
Despite making the network cheaper to use, Bitcoin transaction fees are also much cheaper now. It fell from a peak of $54 per transaction in April to an average of $7 a day.