Bitcoin enters first hashrate bear market

Bitcoin's network hashrate has fallen from 1,030 exahash per second (EH/s) on May 28 to 885 EH/s, reflecting a sharp contraction in mining activity as bitcoin prices retreat to levels last seen in February.

The decline has coincided with a significant reduction in mining profitability, with hashprice falling from $38.69 per petahash per second (PH/s) on May 7 to $28.26 by June 7, representing a 26.96% drop over 30 days.

“Bitcoin is experiencing its first historic hashrate bear market,”

Said Elektron Energy chief executive, Rapha Zagury.

Transaction fees remain a minimal contributor to miner income, accounting for just 0.73% of total rewards over the past day, leaving operators heavily dependent on block subsidies and bitcoin's market price.

Network difficulty is expected to decline by approximately 10.76% on June 13 after average block times drifted to around 11 minutes and 12 seconds, potentially reducing competition among miners that remain online.

Zagury argued that despite the hashrate contraction, Bitcoin's security remains intact because the capital required to conduct a 51% attack remains prohibitively expensive even at lower network participation levels.

He said the more significant long-term challenge is the weak transaction fee market, as fees account for less than 1% of miner rewards despite the ongoing reduction in block subsidies, while many publicly traded mining firms increasingly allocate resources toward artificial intelligence infrastructure instead of expanding bitcoin mining operations.

At the time of reporting, Bitcoin price was $63,210.80.