All cryptocurrencies work without an intermediary, so their transactions are completed through the blockchain network made up of miners. Due to the presence of a cryptographic layer in the blockchain, miners have to solve complex mathematical puzzles to validate a block.
Thus, crypto mining requires machines with high computing and GPU power. The hash rate is like a metric for the computational power required for mining. It assesses the security and health of a cryptocurrency network. Here's a closer look at the hash rate and what you should know about this critical parameter.
What is Hash Rate?
The term "hash rate" refers to the total amount of processing power utilised to mine and process transactions on a Proof-of-Work(PoW) blockchain. It is the number of miners working to validate transactions and the speed with which they can create hashes. It is used to determine how quickly a cryptocurrency miner's machines solve these computations.
“Hash” in hash rate refers to a fixed-length alphanumeric code that is used to represent any length of words, messages, or data. A cryptographic hash is generated after the validation of every transaction. Crypto projects employ some hashing algorithms to generate various forms of hash code. For example, Bitcoin uses the SHA256 algorithm for the creation of hash codes. Think of them as random word generators, with each technique representing a unique system for creating random words.
A high hash rate is considered to be favourable for all the miners in the network. Hash rate is directly proportional to a miner's or mining pool's profitability. A better hash rate indicates a greater probability of mining a block. As a result, there is a greater chance of obtaining the block reward for miners.
Hash Rate measurement
The hash rate is a measure of the number of calculations that can be completed per second, which may be expressed in billions, trillions, quadrillions, and quintillions and is denoted by the notations:
KH/s (kilo): thousands of hashes per second
MH/s (mega): millions of hashes per second
GH/s (giga): billions of hashes per second
TH/s (tera): trillions of hashes per second
PH/s (peta): quadrillions of hashes per second
EH/s (exa): quintillions of hashes per second
Hash rates vary from network to network and even miner to miner because of the speed of the machines utilized and the number of miners in a network. For example, Bitcoin measures the hash rate in exahashes per second (EH/s) and Ethereum’s hash rate is measured in terahashes per second (TH/s).
The entire network hash rate is estimated by comparing the average time between mined blocks to the network difficulty at a certain point in time. For example, if the Bitcoin network has a hash rate of about 250 EH/s, which means that all miners on the network are computing the output of the SHA-256 cryptographic hash function about 250 quintillion times per second on average. Read More...
