According to a recent CoinShares report on mining, Bitcoin’s hashpower could reach 1 Zettahash per second by July.
To tell the truth, according to the hourly data from CoinWarz this result was already achieved shortly before mid-April, but only for a few minutes, and since these are only estimates and not precise measurements, the single hourly peak in April doesn’t count for much.
Taking instead as a reference the 7-day moving average of Hashrate Index, the 930 Exahash per second mark has never yet been surpassed.
How to read the Zettahash?
Zetta is a prefix that means a thousand billion billion.
So a Zettahash per second (Zh/s) means a thousand billion billion hashes per second.
It is a unit of measurement used to measure the amount of hash that is generated in one second worldwide by all miners.
Just think that a single ASIC machine among the most powerful ones is capable of generating hundreds of Th/s (Terahash per second), which means several hundreds of thousands of billions of hashes per second. Therefore, a couple of those machines may be enough to reach 1 Ph/s (Petahash per second), and with 2,000 of those machines, you can reach 1 Eh/s (one billion billion hashes per second).
Given that there are several mining farms around the world that have thousands of ASICs, there might already be several capable on their own of exceeding 1 Eh/s.
In total, the seven-day moving average reached a peak of 921 Eh/s on April 9, but it is a record that seems to be destined to be broken in the coming months.
The CoinShares report: Bitcoin hashpower at 1 Zettahash by July
The extensive report by CoinShares states that the Bitcoin mining industry largely ignored concerns related to last year’s halving, with the hashrate experiencing a strong acceleration in the fourth quarter of 2024 thanks to the increase in BTC price.
It also forecasts that the network will reach the symbolic milestone of 1 Zettahash/s by July 2025.
It also states that by now the valuation multiples across the entire sector have compressed, so much so that Bitcoin mining would have become a zero-sum game, where the capacity gains of one miner directly erode the market share of others. In fact, several miners are beginning to strategically diversify their activities by engaging in other initiatives, such as data center infrastructure and hosting of high-performance computing (HPC) systems.
Just consider that, according to CoinShares estimates, the weighted average cost to mine 1 BTC in the fourth quarter of 2024 was $82,162, while the average market price of BTC in the same period was only $83,800. Therefore, the profits have now become minimal, unless one manages to pay very little for electricity.
The hashpower of Bitcoin
Always taking as a reference the 7-day moving average of Hashrate Index, the current hashpower of Bitcoin would be about 822 Eh/s.
This is a high level but not very high, down from mid-April when it had indeed surpassed 900 Eh/s.
This decline is obviously due to the drop in the price of Bitcoin, which, however, has recovered in recent days.
It is worth noting, however, that at the beginning of the year it was at 803, while a year ago it was at 647. The really curious thing is that the peak of 2021, when the price of BTC first came close to reaching $70,000, was only 180 Eh/s, and this huge difference can only be explained by a strong increase in efficiency over four years.
In fact, there are two ways to increase hashpower, thus increasing the chances of mining a block and earning the reward in BTC. Either you add more machines, or you replace outdated machines with new, more efficient machines.
A more efficient machine is indeed able to extract more hashes with the same energy consumption, and it is precisely the increase in ASIC efficiency that has allowed the hashrate to increase by almost 4.5 times in four years, compared to a price increase of only 1.4 times.
However, this is not helping the miners much, except to increase competition among themselves, because now the machines are being pushed to the maximum to achieve the highest possible share of hashpower, at the expense of profitability. And so, in the end, Bitcoin mining from competition among miners becomes a zero-sum game, where every additional percentage point of hashpower by one miner necessarily means one percentage point less for another.
