Bitcoin’s network hashrate has declined roughly 6.8% from its November 2025 peak, marking the most notable pullback since the 2021 China mining ban. While sustained hashrate declines often spark concerns about miner capitulation, current conditions point to a routine economic adjustment, not a structural breakdown of the network.

Rational capital allocation at work

Mining is an inherently capital-intensive business that converts electricity and hardware into Bitcoin. Miners exit the network when returns no longer justify operating costs. This typically occurs when prices stagnate or fall, operating expenses rise—particularly electricity—or financing conditions tighten.

As dollar-denominated revenues compress, marginal operators become unprofitable first. These miners often liquidate reserves to meet expenses before ultimately powering down equipment. Such behavior reflects rational capital reallocation in response to short-term economic pressures, rather than systemic distress.

Percentage decline vs network scale

Measured in percentage terms, the current drawdown remains modest compared with past cycles. The 2021 China mining ban abruptly removed over 40% of global hashrate due to regulatory intervention, representing a true structural shock. In contrast, the present decline has unfolded gradually, without a clear external catalyst.

In absolute terms, however, the drawdown is unprecedented. Approximately 75 EH/s has gone offline, making it the largest absolute hashrate reduction on record. This reflects the sheer scale of today’s network—where even small percentage moves translate into historically large numbers—rather than exceptional stress.

Historically, widespread miner capitulation requires prolonged and severe price weakness. Periods of declining hashrate often coincide with late-stage adjustment rather than the start of deeper market trouble. Once miners begin re-deploying capital and hashrate stabilizes, the most acute phase of the correction is typically behind the market.