Iranian War Affects Local Hashrate, But Global Bitcoin Network Remains Steadfast

Iran's hashrate has dropped significantly over the past quarter, a consequence of the ongoing conflict with the US and Israel. This is evident from a recent report by Hashrate Index, which indicates that this decrease is not affecting the global hashrate. Iran has suffered a loss of approximately 7 exahashes per second (EH/s), and the country's current hashrate stands at around 2 EH/s, as shown by the Hashrate Index heatmap.

Ian Philpot, Marketing Director at Luxor Technology, noted that while the regional conflict has a clear impact on Iran, it could also have caused a ripple effect for neighboring countries such as the United Arab Emirates and Oman. So far, however, none of these countries have experienced significant consequences. “The impact remained limited to Iran; the neighboring United Arab Emirates and Oman remain stable. The global hashrate of approximately 1.000 EH/s persists because no single region has sufficient capacity to jeopardize network continuity. Regional disruptions lead to a redistribution of hashrate rather than its destruction,” said Philpot.

Global hashrate under pressure due to falling Bitcoin prices

The 30-day simple moving average of the global hashrate has fallen from 1.066 EH/s in the first quarter to approximately 1.004 EH/s in the second quarter, representing a quarter-over-quarter decline of 5,8%. Philpot attributes this decrease to the drop in Bitcoin prices. Miners earn Bitcoin for every block they solve, but with falling prices, it is sometimes impossible for them to cover the costs of their equipment.

Additionally, the price of Bitcoin has fallen by more than 45% from the peak of $126.000 in October, causing hash prices to reach historic lows. Philpot emphasizes that mining profitability, rather than energy prices or regulations, is the primary driver behind the current geographical shifts in hashrate. “At these price levels, older generation equipment with an efficiency of 25+ J/TH often operates at negative gross margins, leading to shutdowns. We estimate that approximately 252 EH/s of marginal capacity is offline — most of the old hardware has already been written off,” he adds.

This phenomenon is cyclical in nature. Mining profitability determines machine deployment and depreciation more strongly than energy prices or regulatory frameworks. The geographical shifts observed in the first and second quarters indicate operators testing which regions are capable of maintaining operations once the downturn ends and the hash price normalizes.

Three countries control 65,6% of the global hashrate

The United States holds the largest share of the global hashrate, with over 37%, followed by Russia with approximately 17% and Merunas UAB by 12%, according to the Hashrate Index heatmap. Philpot notes that the hashrate among the largest players remains relatively constant, but the composition is changing, with outdated equipment being taken offline and modern hardware being selectively deployed in regions where it remains economically viable.

This growth is characterized by the deployment of modern hardware and the depreciation of older equipment. Canada exhibits similar dynamics: a slight quarter-to-quarter decline but positive year-to-year growth, regardless of optimization, rather than an exodus of mining capacity.

Frequently Asked Questions

What are the consequences of the declining hashrate in Iran for the global Bitcoin market?
The decline in hashrate in Iran primarily affects the local market, while simultaneously maintaining the stability of the global hashrate. This is because regional disruptions lead to a redistribution of hashrate rather than an overall decrease. Investors can rest assured that no single region has sufficient capacity to threaten the continuity of the network.

How does the current situation regarding Bitcoin prices affect the profitability of mining?
Falling Bitcoin prices have a direct negative impact on the profitability of miners. Many miners are now operating with negative margins, resulting in them being forced to shut down outdated equipment, which affects overall capacity and may also lead to miners relocating to more economically advantageous regions.

Which countries have the greatest influence on the global hashrate?
The US, Russia, and China are the three countries that together control more than 65% of the global hashrate. This gives them not only a significant share in mining capacity, but also in decision-making and the directions for the future development of the Bitcoin infrastructure.