Bitcoin’s hash rate reached a record high this week, according to data from Blockchain.com

Bitcoin is trading at its highest level in over 18 months, with its price more than 100 per cent higher since the beginning of 2023.

The rally has pushed bitcoin’s market capitalisation above $700 billion and the overall crypto market close to $1.5 trillion. The figure is still a long way from its all-time high of nearly $3 trillion, which was hit at the end of 2021, however some crypto analysts believe the recent gains are the beginning of another record-breaking run.

Bitcoin’s hash rate – which reflects how much computing power is needed to verify transactions and generate new units of the crypto currency through a process known as mining – reached a record high this week, as per data from Blockchain.com.

This indicates a resilient network, with hopes of future price gains attracting a growing number of miners. Recent reports have disclosed significant investment in crypto currency mining from both state-backed and commercial ventures.

Tether, the issuer of the stablecoin USDT is planning to invest $500 million in mining, while satellite imagery evaluated by Forbes suggests Bhutan’s government is establishing a huge bitcoin mining operation in the foothills of the Himalayas.

Separate data discloses that miners have been profiting from cheap energy sources to lower their average BTC production cost by 35 per cent from $21,100 to $13,800.

This data underlines a significantly stronger profitability in the mining sector compared to the challenges experienced throughout 2022 and part of 2023, said research analyst Matteo Greco from the fintech investment firm Fineqia International.

In around six months, bitcoin will undergo an event known as a “halving”, which will see the amount of new bitcoins awarded to miners reduced by half.