Bitcoin Network Strengthens as Hashrate Climbs to Unprecedented Levels

Bitcoin Hashrate Surges to Record High as Miners Struggle with Declining Fees

Bitcoin’s (BTC) mining power has hit an all-time high, with the network’s seven-day average hashrate climbing to 833 exahashes per second (EH/s), a 9% jump from 767 EH/s just days earlier, according to Glassnode data.

Despite the record-breaking hashrate, Bitcoin transaction fees have dropped to multi-year lows, with high-priority transactions costing just 5 sat/vB ($0.69). This decline in fee revenue is putting financial strain on miners, who are already dealing with reduced block rewards after Bitcoin’s April 2024 halving.

Miner Mag reports that demand for new mining hardware has slowed following a pre-halving rush, as firms that had aggressively expanded their operations are now re-evaluating their strategies. While institutional investment has driven significant infrastructure growth over the past 18 months, analysts believe hashrate expansion could slow in the coming months.

Since the halving, Bitcoin’s hashrate has surged more than 40%, reinforcing network security. However, miner profitability has remained stagnant due to lower transaction fees, which now contribute a smaller portion of their overall revenue.

Bitcoin’s economic model is designed to shift reliance from block subsidies to transaction fees over time, but the current market conditions raise concerns about the sustainability of this transition.

Meanwhile, Bitcoin’s next difficulty adjustment—set to occur in four days—is expected to increase by over 6%, making mining even more competitive and further squeezing miner profitability.