There is ongoing speculation about why the Bitcoin price has plummeted. We are taking a closer look at one of the potential explanations.
The current mantra stays the same: Bitcoin is bleeding. In the article “Bitcoin Massacre: Why $1100 Plunge?” Altcoin Buzz brought up the factor of dwindling hash rates. Is it a coincidence that just before the launch of the much anticipated Bakkt, the total cumulative of the computer systems mining Bitcoin blockchain plummeted?
The answer is: it could very well be the case. There might be a correlation between the sudden nosedive of the Bitcoin hashrate and the launch of the Bakkt platform. However, there is evidence that primary Bitcoin mining operations located in Canada and Kyrgyzstan have also suffered power outages. Currently, the Bitcoin hashrate seems to have returned to its pre-flash-crash levels.
What Caused The Bitcoin Hashrate Plummet?
Before this moment, the Bitcoin hashrate has been at all-time highs in 2019.
It was a massive surprise to crypto enthusiasts to see the total computing power mining the Bitcoin network suddenly crash by almost 40%.
The hash rate fell from more than 98 million TH/s to a merger 57.7 million TH/s. This is according to the data from Coin.Dance.
The drop occurred just hours to the launch of the much-anticipated Bakkt platform.
Analysts say it might not be unconnected with what had happened in Kyrgyzstan. The nation cut off power to about 45 mining firms according to the local news outlet
. It reported that mining operation in the country of Kyrgyzstan uses as much power as three regions in the country combined. In Canada, Squire Mining Limited has also gone offline due to the power outage in Kyrgyzstan. The available information suggests that the power outage is expected to last between 10 to 14 days while Squire Mining’s hosting provider upgrades its system.
At the point in time, there have been sketchy reasons to the sudden drop in the Bitcoin hash rate, but be assured that we shall keep you updated on the situation as it unfolds. Currently, the hashrate has risen to 92 million TH/s, but the fact that an unknown factor could drop the network’s hashrate to such a significant percentage raises questions about the overall security of the system.
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