BITCOIN HASHRATE (HR/t)
The graph above illustrates Bitcoin’s price and Hash Rate (HR) over time. The Hash Rate is the average amount, for each node in the mining network, of attempts at mining a Bitcoin Block. The Hash Rate in Tera Hashes per second, and Bitcoin’s Price is in USD.
Their movement is noticeably correlated, as well as their decelerating rate of change over time, also known as Bitcoin’s diminishing returns. This means buying into the market today, will return lesser percentage gains in two year’s time, with respects to having bought into it in 2016, and selling in 2018. This decreasing ratio is everlasting, ceteris paribus, given bitcoin’s nature.
BITCOIN PRICE – HASH RATE RATIO
Above is a graph illustrating Bitcoins Price in USD, instead of over time, over the previously overplayed Hash Rate (TH/s). This allows us to visualise the ratio between peaks, as price changes can be kept account for given Hash Rate values, our independent variable. The dotted lines represent orders of magnitude.
BITCOIN HASH RATE – PRICE RATIO
This graph allows for the previous trend to be integrated over time, by dividing y/x, and reinserting time as our independent variable. Now, HR-P ratio , allows for a fundamental combination of metrics to be compared over time. The dotted lines represent Bitcoin Haltings, a fundamental concept underlying bitcoins nature. The Bitcoin’s halving events, historically and at future ‘predicted’ dates are illustrated below.
Bitcoins are created at a decreasing predictable rate, the number of new bitcoins created each year is automatically halved over time until bitcoin issuance halts completely with a total 21 million bitcoin in existence.
BITCOIN PRICE – ACTIVE ADDRESSES RATIO
This is another fundamental relationship, the Price – Active Addresses ratio. The dotted lines still represent the Bitcoin Halving’s. As we can see bitcoin’s active addresses are steadily increasing, and during strong ‘bull markets’ scenarios tend to peak, and after start consolidating up to bitcoin halving, where they tend to start steadily increasing again.
BITCOIN PRICE – TRANSACTION COST RATIO (P/uTC)
This graph is fundamental as it shows Bitcoin’s community, developing the hardware and the software side of it, are growing fast and keeping up with the boundaries of the technological industry as a whole. One could imagine as the costs, and size of a network increases, the cost of the service would increase as well. We can see that happening up until late 2017, at a rate of about 10x, since then, to date, the rate of increase for the cost of using the bitcoin network seams to have reach an asymptotic 3.3x.