Bitcoin [BTC] has seen a sharp drawdown from its 2021 peaks in the ongoing bear market. Indeed, the world’s largest crypto asset was 60% below its all-time high (ATH) of $69,900 at the time of writing, per CoinMarketCap data.
Steady hashrate increase
But despite the drawdown in its valuation, the blockchain has continued to thrive. According to on-chain analyst Joe Burnett, Bitcoin network hashrate has climbed from 165 ExaHashes per second (EH/s) on the day it scaled its peak, to 400 EH/s at the time of the post.
This reflected a staggering 142% increase.
A rising hashrate, or the computational power required to solve complex cryptographic puzzles, was an indication that more miners were involved in validating transactions and securing the Bitcoin network.
This could be the logical result of growing on-chain activity and Bitcoin adoption.
High network demand for Bitcoin
According to Glassnode, transactions on the network have indeed shot up in recent years, with 2023 witnessing unprecedented demand for the block space. A closer inspection revealed that the network’s ATH of over 703,504 was only achieved last week.
Investors accumulate Bitcoin
Users have been drawn to Bitcoin in the last few years as its narrative of a safe-haven asset has acquired mainstream awareness. Bitcoin has remained largely insulated from implosions like that of FTX and TerraUSD [UST], and regulatory hurdles which have become a big thorn in the flesh for other altcoins.
The resilience led many users, including retail investors, to add Bitcoin to their portfolios. A recent update shared on social platform evidenced the growing ownership.
To top it all off, whale investors have been constantly adding BTCs to their holdings. As per Santiment, the number of wallets containing 10,000-100,000 coins has been increasing since the pinnacle of the 2021 market.
Bitcoin’s network utilization clearly surpassed its market cap, effectively pricing it at a discount. This pattern may bode good for Bitcoin’s value in the long run.