What is the Hash Rate? (2024)

Unot one of the most used terms in the world of cryptocurrency mining is hash rate o hash rate. This makes mention of the numerical value within each cryptocurrency that uses the Proof of Work (PoW). The value indicates the amount of computational operations that a miner or the network of miners as a whole is capable of carrying out. All this in order to solve the cryptographic riddles derived from the cryptographic function that the cryptocurrency uses.

This concept was born alongside the first cryptocurrency, the Bitcoin. Since then it has become an important part for this cryptocurrency, since it indicates the power of the network, and tells us how it will evolve over time. Of course, the hash rate is more than just a number, it is a critical concept for the technology of bitcoin and any cryptocurrency that derives from it.

Now, what does the hash rate really mean? What is its true importance and impact on cryptocurrencies?

What is the hash rate?

First of all, we must point out that this indicator is very important. The hash rate is a competition in which leading can mean an income of more than 10 million euros per day, allowing you and not another person to mine a block. For this same reason there is a fierce struggle, reserved for very few, to get devices that have an increasingly optimal and fast calculation.

At the beginning of the article we explain that the hash rate "It indicates the amount of computational operations that a miner or the network of miners as a whole is capable of carrying out." Seen in a universal way, the concept is correct. But in the world of cryptocurrencies, this concept falls short to explain what hash rate really means.

The hash rate as an expression of power of a miner

First of all, for mining a bitcoin you need a computer or electronic device capable of solving hashes type SHA-256. This is because the protocol PoW of Bitcoin, use this function for mining work. In the early days of Bitcoin, a simple computer was enough to quickly resolve the system's SHA-256 hashes.

However, today and due to the dynamic complexity After this task, it is practically impossible to mine bitcoins using a simple computer. This is because in order to generate a hash that meets the specifications, trillions of nuncio, a very complex job. As a result, today getting the hash of a valid block has a mining difficulty very high. So to succeed in this task you need specialized hardware, such as ASIC miners.

Thanks to the above, we can have our first insight into the concept of hash rate. In this sense, we can define it as follows:

The hash rate refers to the computing power of a cryptocurrency miner to provide solutions based on a specific cryptographic hash.

Thus, for example, we can understand the difference between a computer, which is capable of solving a few mega hashes per second (MH/s) (millions of SHA-256 hashes per second) and a miner. FPGA o ASIC that is capable of reaching from hundreds of MH/s to tens of terahashes per second (trillions of hashes per second).

At this point, the concept of hash rate is used to show the potential of a miner. However, there is another use where the term hash rate is also important.

The hash rate as an expression of the power of a blockchain network

As you well know, the Bitcoin network is made up of hundreds of thousands of miners specialized in this task. Each specialized miner is thousands of times more powerful than a computer at resolving SHA-256 hashes. But the best thing about all this is that the work of all these miners adds up. All in order that your set on the network ends up offering a higher power that allows you to resolve SHA-256 hashes faster.

With this we have our second definition:

The hash rate refers to the global capacity or power of a cryptocurrency's network to solve the cryptographic puzzles that result from the Proof of Work and the cryptographic function that is implemented.

In short, the working power of all the miners within the Bitcoin network is added so that we can finally know the total power of the network. Currently, the Bitcoin network has a global hash rate of 110.000 PH / s.

Another example can be seen in Ethereum, whose global network hash rate exceeds 180 TH/s. In each of these cases we speak of the total hash rate of the network. This is a fact of enormous importance as we will see below. Bitcoin is the most powerful computer network on the planet, superior to that of governments, corporations like Google or intelligence institutions like the NSA.

Importance of the hash rate

The above then leaves us with a new question: How important is the hash rate? Well, the hash rate is a data that allows us to know two things.

Hash rate as a demonstration of network security

The value of the hash rate allows us to know how secure the mining network of a cryptocurrency is. The rule is simple The higher the hash rate, the more secure the network is. This is because the power required to carry out a 51% attack is increased. Since that power can only be achieved by hundreds of thousands of miners, the chance that a malicious entity can pull off this attack in isolation is drastically reduced.

Hence, many specialists pay special attention to the global hash rate of a cryptocurrency to find out if it is safe. In fact, several cryptocurrencies have been victims of 51% attacks, because their hash rate is so low that a single miner can successfully run it. In the case of Bitcoin, this is practically impossible, since its global hash rate can only be defined in one way: monstrous and unattainable by a single attacker.

Hash rate for calculating mining difficulty

On the other hand, the hash rate is also used to calculate the mining difficulty. Remember that the mining difficulty is adjusted to a certain number of blocks and depending on the time it took to find or generate those blocks. For example, in Bitcoin the average time between blocks is 10 minutes. Bitcoin's algorithm is programmed so that every 2016 blocks the difficulty is adjusted. This means that it is adjusted approximately every 2 weeks.

Now, why adjust the difficulty? Well, the reason is that the Bitcoin mining network increases in power every time a new miner comes online and starts mining. Thus, the global hash rate of Bitcoin increases, and the time it takes for the network to generate a block is shortened. This is because the network of miners can resolve hashes faster by generating blocks faster than desired. At that point, the algorithm that controls the mining difficulty in Bitcoin would adjust the mining difficulty again, to once again return to the stipulated time of 10 minutes per block.

The hash rate value intervenes in this complex process in order to provide the value of the power of the network. This value is then used to correct the mining difficulty by increasing or decreasing it as the case may be.

Various network validation and testing processes

But beyond this, the value of the hash rate of a network like Bitcoin is also useful for other cases. Following our example with Bitcoin, the hash rate is also used as a vital value in facilitating certain network monitoring functions.

En Bitcoin Core We can see functions to calculate the time it would take to redo a work difference between blocks, taking the hash rate and the current difficulty. It is also used as part of the functions for block validation.

In short, we are faced with a value with great utility and that we simply cannot take for granted. After all, the hash rate tells us at all times the state of health of the network and the miners that make it up.

The hash rate and mining hardware companies

Many people talk about cryptocurrencies and often mention decentralization of them among their benefits. Well, this is actually a hotly debated point in the community and with good reason. Currently, there are a very limited number of companies that concentrate enormous technical capacity and hardware to mine.

Companies like Bitmain or Canaan, have a huge presence in different cryptocurrencies, especially in Bitcoin. But not only for creating powerful ASIC miners, but for having a monopoly on this market and accompanying it with gigantic mining pools. A fact that has made more than one ask: Is the mining hardware that these companies offer the latest of the latest? Are the most powerful miners reserved for themselves and then released when they develop a new generation?

In either case, these companies and the monopoly they exercise puts Bitcoin decentralization at risk. However, despite this situation so far no serious problems have occurred so far.

Hash rate and the energy consumption associated with it

Another important point is the relationship between the hash rate and the total energy consumption of the blockchain network. The relationship is very simple, the more power is added to a blockchain network, the greater the energy consumption. Obviously this has an important footprint and impossible to neglect. In fact, networks like Bitcoin have set milestones in terms of energy consumption. The latest calculations made by specialists indicate that Bitcoin has consumed as much electrical energy as Switzerland consumes in a year. To give a figure, it would be about 65 TWh per year.

However this does not mean that Bitcoin wastes energy. In fact, compared to processes such as gold mining or oil production, Bitcoin hardly consumes energy. But beyond that, all the intense mining work of Bitcoin and other cryptocurrencies like Ethereum is not a waste. After all, these networks maintain unique systems that are considered the future of the world economy. So let's forget about myths about bitcoin and other cryptocurrencies, and let's accept that every watt spent has been worth it, and always will be with the goal of creating free money. The question should be why governments don't boost purely renewable energy much more.

Hash rate units

• 1 kH / s is 1,000 (thousand) hashes per second;
• 1 MH / s is 1,000,000 (1 million) hashes per second;
• 1 GH / s is 1,000,000,000 (1000 billion, 1 billion US) hashes per second;
• 1 TH / s is 1,000,000,000,000 (1 American trillion) hashes per second;
• 1 PH / s is 1,000,000,000,000,000 (1 American quadrillion) hashes per second;
• 1 EH / s is 1,000,000,000,000,000,000 (1 quintillion) hashes per second.

Typical hash rate conversions

• 1 MH / s = 1,000 kH / s;
• 1 GH / s = 1,000 MH / s = 1,000,000 kH / s;
• 1 TH / s = 1,000 GH / s = 1,000,000 MH / s = 1,000,000,000 kH / s.