BlockchainBlockchain GuideBlockchain and crypto: What is the hashrate?

Blockchain and crypto: What is the hashrate?

The hashrate is an English term for the mining power of a computer. In French, we can find the expression hash rate or hash rate, even if the English name is very often used as is often the case in cryptocurrencies.

This is a data that is very important in the mining industry because it makes it possible to evaluate the number of crypto-assets that it is possible to mine with a given material, which makes it possible to estimate its potential profitability according to of a given price of a digital currency.

What are the factors that increase the hash rate?

The rate of hash needed to mine a cryptocurrency essentially depends on the number of people who perform mining actions on the asset in question. Thus, the more miners there are, the more difficult the competition will be and the more computing power will be needed to solve an operation or validate a block.

Usually, the number of miners increases when the value of a digital asset increases, since it is possible to get more money for the same job. But as a result of competition, the cost of electricity needed to run mining equipment is also increasing.

If these expenses in electricity can be harmful for the environment, this has the merit of reinforcing the security of a blockchain because it is necessary to use much more computing power to carry out a given operation.

What are the factors that lower the hashrate?

Similarly, the hashrate decreases when the profitability of the cryptocurrency drops. For example, no one is going to spend more money on electricity than can be earned by reselling the mined cryptoassets.

When the prices of a digital asset collapse, unprofitable miners prefer to stop trading and try their luck in another currency. Usually, only people who live in a country where electricity is cheap can still be profitable.

However, when the price of a crypto decreases, the hash power required to successfully mine these digital currencies also decreases, which allows miners who were not profitable at time X to become profitable again and therefore to be profitable. ‘deal again with securing the network.

Conclusion on the hashrate

Generally, the newer the computer hardware, especially graphics cards, the greater their hash power. Over time, therefore, it is necessary to constantly update its hardware in order to reduce electricity costs and be able to remain competitive with other miners.

It should be noted that the hashrate only makes sense on cryptocurrencies that can be mined, which is generally called “coin”. Regarding “tokens”, that is to say tokens that use another blockchain to operate, they are not affected by this hash rate since we generally have to mine the native cryptocurrency of the network, as per example ether with regard to ERC-20 tokens.

Florent Malice
Florent Malice
Malice is an Irish sports journalist and former amateur and part-time road bicycle racer, He wrote for The Sunday Times newspaper and others, and published a number of books.

Latest news

Dubai to Witness the World’s Largest Web3 Conference: ABC Conclave to Unite Global Web3 Pioneers in Dubai World Trade Centre

Dubai, UAE, 17th September 2023, ZEX PR WIRE, ABC Conclave, is set to gather blockchain enthusiasts, industry leaders, and...

Empowering Web3 Developers: MetaTrust Labs’ Open-Source AI Engine Revolutionizes Security

Singapore, 16th September 2023, ZEX PR WIRE, In a groundbreaking move, MetaTrust Labs, a provider of Web3 AI security...

GasZero, Tencent Cloud International, and PolygonLabs Successfully Host Web3 Gaming Event in Singapore

Singapore, 13th September 2023, ZEX PR WIRE, The collaborative event titled ‘Token2049 Side Event,’ hosted by GasZero, the first blockchain...

Bitget Introduces Copy Trading: Simplifying Crypto for All

Victoria, Seychelles, 8th September 2023, ZEX PR WIRE, Bitget, one of the most popular cryptocurrency exchanges, is proud to...

Clayton’s Quality Tree Service LLC Announces Free Tree Removal Consultation Services for Deltona and Deland Residents

Deltona, Florida, 8th  September 2023, ZEX PR WIRE, Clayton’s Quality Tree Service LLC, a leading name in professional tree care services,...

SA Styles, a Ladies Formal Fashion Company, Sees A Surge In Positive Reviews After Increasing Investments In Customer Service

Los Angeles, California, 8th September 2023, ZEX PR WIRE, SA Styles, a prominent name in the lady’s formal fashion...

Must read

USD 19,500, the new key price of bitcoin to start an upward movement

Key facts: In the past, $19,500 has been a resistance...

Blockchain IDOs and Presales You Should Know About

There’s never a lack of new projects opportunities when...

The 10 rules to prepare for the crypto bear market by the savvy investor

While the Bitcoin and cryptocurrency market reached a record capitalization in...

Latin America’s E-commerce Giant Opens Up To Buying Bitcoin

Bitcoin (BTC) and cryptocurrencies are increasingly accepted every day for...

Binance Welcomes Arbitrum – Ethereum’s Second Layer!

For many months, the Ethereum (ETH) network has faced...

You might also like
Recommended to you