The king of cryptocurrencies soared to $64,000 but suffered a massive crash afterwards to around $53,000. At the time of writing, Bitcoin is trading at $57,000 apiece. But what caused the hard crash of the cryptocurrency in the middle of strong bullish momentum? One analyst suggests it was the Chinese!
Chinese mining hub in Xinjiang had suffered from power outages and on-chain analyst Willy Woo speculates it to be the cause of the fall of Bitcoin’s price. In the aftermath of a flooding accident in a coal mine, blackouts in the region were rampant to facilitate safety inspections.
Around 25% of the global hashrate can be attributed to Xinjiang and amidst the blackout one of the largest drops in Bitcoin network hash was recorded – from 172 million terahashes per second to 154 TH/s. The analyst Willy Woo has attributed the fall in Bitcoin price to the drop in the hashrate on account of power outages in Xinjiang.
However, not everyone agrees with the analysis. Adam Cochran – a partner at Cinneanhaim Ventures – regarded the idea of the Bitcoin crash due to hashrate fall as nonsense. Cochran further talked about the events merely occurring at the same time while there is no causation or correlation between Bitcoin price and hashrate.