The computing power of the Bitcoin (BTC) network has fallen by more than 15% in one week.
In question, the Chinese miners who migrate every year at the end of the rainy season towards fossil energy sources.
The consensus that secures Bitcoin
The consensus that secures the Bitcoin blockchain is called Proof-of-Work (PoW) in English. The Bitcoin network requires miners to perform transaction verification.
Proof-of-Work allows miners to solve a cryptographic problem requiring significant computing power.
The cumulative computing power of Bitcoin miners has exceeded 150 million Terahash (TH / s) several times, meaning that 150 billion billion operations are performed every second.
Migration of Chinese miners
The total computing power of the Bitcoin network fell from 142 exahash per second (EH / s) to 118 EH / s, a decrease of 16.9%. How can we explain this phenomenon?
One of the main reasons is said to be the change of seasons in China, where over 70% of Bitcoin miners are located. Thus, the miners change their energy source at the end of the rainy season. Miners are looking for fuel-based power plants before the winter dry season arrives.
Many miners are currently disconnecting their equipment from hydroelectric power stations and transferring them to fossil fuel power stations that are scattered across the vast areas of northern China.
The rainy season in China usually lasts from June to October, which generates excess production from hydropower plants, especially in the southwest of the country. This excess energy translates into more attractive electricity prices for Chinese miners.
The Bitcoin network would therefore be sensitive to seasonal variations. At time of publication, BTC is trading at $ 13,100.