According to a recent survey, around 37% of the cryptocurrency community expects Bitcoin (BTC) hashrate to be higher one month after halving the block reward than it currently is.
The cryptocurrency wallet tracking application, Blockfolio, interviewed its users on April 27. They asked if they believe Bitcoin’s hash rate will be higher or lower one month after the halving.
The community has a positive outlook
Blockfolio’s question has been answered by over 8,000 users. Of the respondents, 37% believe the hashrate would be higher, 29% that it would be lower, and 17% that it would be the same. The remaining 17% admitted that they did not know. Philip Salter, head of mining operations at mining company Genesis Mining, told Cointelegraph that the new mining application-specific integrated circuits, or ASICs, should help preserve Bitcoin’s hashrate after the halving.
Salter explained that to understand the impact of halving on Bitcoin’s hashrate, you need to know several important data points. How Bitcoin’s price will develop, how much miners will shut down due to reduced profitability, and how much hashrate will be added due to new hardware. He explained:
“There is a new generation of [mining ] incoming, which should be back online shortly after the halving. So that by default it will increase the hashrate. […] It is evident from the survey results that people are not sure how to answer these questions. But more people think the hashrate will rise, showing bullish sentiment on the price and […] trust in producers for on-time delivery “.
An expert’s prediction
Salter estimates that after the halving, Bitcoin’s hashrate will be about 30% lower than it is today if the price doesn’t increase. If Bitcoin prices continue to rise on the other hand, think the hashrate may remain stable after the block reward is reduced. He also noted that “much of the decline should not happen immediately, as miners cannot shut down immediately.” However, the recovery is expected to follow if the decline occurs:
“In the medium term, the hashrate should recover fairly quickly. Most [ASICs] the one off will be Bitmain S9, with an efficiency of about 90 W / TH. The new [ASICs] they have ~ 30 W / TH, so it can deliver three times more hashrate with the same power consumption. This gives us a good estimate of how much hashrate can increase without new farms being built. “
Finally, Salter expects the health of the Bitcoin network to remain largely unaffected. He admitted that Bitcoin mining will centralize slightly due to less optimized operations disrupting business. Total electricity consumption will also decrease due to blocking of some activities. However, he believes those changes will only be temporary. He says the new hardware will allow home miners to participate in Bitcoin mining again.
Bitcoin Cash (BCH) halved its bulk reward earlier this month. Shortly after the halving, the network experienced a 60% drop in hashrate from 4.36 EH / s to 1.6 EH / s in less than a day. As a Cointelegraph analysis explained shortly thereafter, the Bitcoin Cash halving reduced the profitability of network mining and led miners to flee to competing blockchains.