Bitcoin hash-rate recovery

There are many on-chain analysts, and large investors, that consider Bitcoin's hash-rate one of the key measures of the Network health. I fully agree with them.

A “hash” is a fixed-length alphanumeric code that is used to represent words, messages and data of any length.

(Example: f2429204b339475a3d94dd5450f5ebb3c80130a85fbb91d62768741a3b34a6b6)

Hash-rate refers to how many calculations per second can be performed on the Bitcoin network. Put simply, it is the speed of mining and represent its total computational power.

The 2021 hash-rate recovery post China ban on mining in May 2021 is an especially strong sign of health for Bitcoin, and once and for all put to bed the narrative that one nation can control what happens to the network. In fact we are now sitting at an ATH for this metric.

From BTC.com

Essentially what happened is that mining capacity relocated from an unfavorable environment (China), to other countries in the world. The US has been a tremendous beneficiary of the China ban as you can see from this other chart from BTC.com

As the hash rate improves because miners find Bitcoin enticing, so does the network security.

Before new transactional data can be added to the next block in the chain, miners compete using their computational power to guess a number.

Each hash created is random and impossible to predict. In fact it can take millions of hashes before the the miner wins the right to fill the next block and be rewarded with newly minted Bitcoin based on the current block reward schedule. Adding a block to blockchain “confirms” of all the transactions stored within that block. Every time a new block is added on top of earlier blocks, those earlier transactions are reconfirmed again and again, becoming more and more impossible to change.

Not top oversimplify things, however a high and ever increasing hash-rate should make you feel more and more secure in holding Bitcoin.