While the hashrate of bitcoin continues to grow, crushing record after record, as the all-time high has been repeatedly exceeded, the other altcoins suffer also on the mining front. One of them is certainly ethereum, which compared to a year ago shows a hashrate drop of 42%.
Analysing Etherscan data, it is possible to notice that the current hashrate of the ETH network is around 176 thousand GH/s, while at the end of July 2018 it was around 280 thousand GH/s.
Ethereum hashrate: drop due to several factors
Having a network with a high hashrate guarantees excellent network security against possible 51% attacks.
Although the drop in hashrate suffered is considerable, the likelihood of 51% attacks on ethereum remains very low. After all, the ethereum network had a hashrate just below its current value by the end of 2017 and at that time there had been no attacks on the network.
The reason why ETH’s hashrate did not go back up as it did on bitcoin is due to several factors. First, the network lost most of its hashrate when the market collapsed between November and December 2018.
These collapses have brought the price of ethereum well below the profitability threshold of many household miners, who have therefore turned off their rigs or switched to other PoW coins.
Another factor that may have slowed down the recovery may have been the Constantinople fork, which occurred last February. It resulted in a reward reduction for each block successfully validated by the miners.
With the introduction of EIP 1234, the reward was reduced from 3 ETH to 2 ETH per mined block, further reducing the revenue of the miners.
Another reason that excluded a part of the miners between the end of 2018 and the beginning of 2019 also concerns the growth of ETH’s DAGGER, which has excluded 3GB VRAM video cards from mining.
Finally, many miners may have decided to invest in hardware suitable for mining other currencies (bitcoin and litecoin) rather than ethereum, since by next year the actual transition phase to the PoS should begin, with further reduction in the reward for the miners active on the PoW.