Bitcoin’s Network Power Dips Below 1 Zettahash Mark: What’s Behind the Shift?
Bitcoin’s network power has taken a notable dip, falling below the 1 zettahash mark after several months of maintaining a higher level. According to recent reports, the seven-day average hashrate has decreased to approximately 993 EH/s, marking a significant pullback from last year’s highs. This drop has sparked interest in understanding the factors driving this change and its implications for the mining landscape.
Hunger for Power: The Rise of AI Data Centers
The primary factor contributing to this shift is the increasing demand for power from big AI data centers. These centers are seeking long-term power contracts and are willing to pay a premium for steady, round-the-clock electricity. This development has led to a change in who gets the cheapest power on the grid, with miners facing stiff competition. As a result, some publicly traded miners are opting to close deals to lease space to chipmakers and AI firms, effectively turning parts of their sites into AI data centers. This strategic move allows them to hedge against volatile mining profits.
A notable example of this trend is a large miner signing a multi-year lease with a major chip company. This partnership highlights how companies are adapting to the evolving landscape by diversifying their operations. On Monday, StandardHash CEO and founder Leon Lyu commented on the situation, stating that the drop in Bitcoin’s network power came as miners shifted their electricity toward AI computing to chase better profit margins.
Why the Shift Matters Now
Electricity is the single biggest cost for mining operations. When data centers bid for the same megawatts, miners are faced with a straightforward choice: pay more, accept narrower margins, or repurpose their capacity. The current market dynamics have led to a situation where miners must reassess their strategies to remain competitive. The network’s difficulty has been eased slightly by the drop in hashpower, which helps maintain block times, but this mechanical adjustment does not alter the underlying issue of who holds the power contracts.
PJM, the grid operator serving the mid-Atlantic, has proposed rules aimed at handling the surging AI demand. The plan requires large new power users to take responsibility for their own supply or accept curtailment rules, ensuring that essential services and homes do not face outages. These measures are designed to limit the strain that rapid AI growth could place on the system.
Image: JHUEngineering
Bitcoin vs. AI: Policy Moves and Political Pressure
US President Donald Trump and several state leaders have urged steps that would make tech firms pay more to secure power, including proposals for emergency auctions to fund new plants. This pressure reflects concerns about higher bills and the risk that expanding data centers could crowd out other users. The situation highlights the need for balanced policies that address the growing demand for power while ensuring the stability of the grid.
What Miners Are Doing to Stay Alive
In response to the changing landscape, many mining operators are not only shutting down rigs when power becomes costly but are also retrofitting their sites to host GPUs and other AI hardware. This strategic shift can provide steadier revenue and longer contracts than mining alone, signaling a structural change in the industry. Bitcoin mining is becoming one part of a broader compute business for some companies, as they adapt to stay competitive.
BTCUSD is now trading at $93,005. Chart: TradingView
While block rewards and protocol rules continue to secure the network, a prolonged period of lower hash rates could lead to increased centralization in areas where power remains cheap. For everyday users, the system continues to produce blocks, but for miners, the contest for electricity has become a defining business problem.
Featured image from Unsplash, chart from TradingView
