14 Dec 2021
Bitcoin on-chain summary: Hashrate at all-time highHashrate reaches all-time high, but the rest of the on-chain metrics are flashing red.
When China banned bitcoin mining in June, more than half of the hashrate quickly went offline. After bottoming at the end of June, the hashrate has grown 114% and reached an all-time high last week.The reason behind the fast hashrate growth following China’s ban is the extreme super profits of bitcoin mining, incentivizing miners to plug in machines as fast as possible to reap the rewards.After China banned mining, part of their mining capacity sought refuge in neighboring countries like Kazakhstan and Russia. North America has also seen considerable growth in hashrate, driven mainly by publicly-traded mining companies massively investing in new capacity.Hashrate is likely to continue growing in the following months since mining is still highly profitable. The biggest mining companies have vast orders of mining hardware scheduled for delivery in early 2022.Although the hashrate increases, all the other on-chain metrics we track are red this week. Most notably, we see a 43% decline in transaction fees per day, as the demand for on-chain transactions is deficient at the moment.