Bitcoin (BTC) Hashrate Booms in May as Price Increase Makes Mining Profitable
A temporary surge in BTC mining activity this month may indicate more miners coming in as profitability increases.
Bitcoin (BTC) mining activity rose close to its peak levels, reaching 54 EH/s, near the record of 60 EH/s. One of the reasons for the rising activity may be the rainy season picking up in China, offering cheaper hydroelectric power. The spike, however, was short-lived, and later mining activity returned to 42 EH/s.
The Bitcoin mining activity may also slow down in the coming days, to ensure a more favorable difficulty readjustment. In the past quarter, BTC mining has been volatile, rising to peaks and crashing again, possibly to affect difficulty calculations.
The other reason may be the spike of BTC prices toward $5,800, ensuring greater profitability based on block rewards. With the upcoming halving of the BTC reward in 2020, we may see miners scrambling for the last of the bigger rewards.
Along with mining, BTC transactions rose to a three-month peak at above 479,000 transfers in 24 hours. Blocktivity counts more than 886,000 transactions, but the number is based on a different type of calculation, counting the unspent transaction output transfers.
In addition to peak mining activity, BTC market prices are dominating altcoins. BTC dominance is above 55% of the entire market capitalization, and above 59% based on other calculations. BTC trading is as active as ever, although more than 80% is based on the Tether (USDT) pair.
BTC traded at $5,696.66 as of 11:45 UTC on Monday, dropping from recent peaks above $6,500. Currently, BTC is at a crossroads again, with bearish attitudes seeing a crash in the coming weeks, possibly repeating the drop from May 2018. Others see the asset at $6,500 again soon.
BTC is still seen as decisive for the direction of the entire digital asset market. Even relatively independent networks and tokens, aiming to displace Bitcoin and propose a better network, are highly dependent on BTC trading and sentiment.