Hash rate is basically Bitcoin's "popularity" chart, which keeps increasing

Image source: pixabay - raphaelsilva

While the total number of likes represent social media influence, hashrate is the cryptocurrency equivalent. The hash rate for Bitcoin which measures computing power is still increasing despite the current price drops.

Miners keep on mining. Traditionally hash rates have been locked onto coin prices however the miner's positive sentiment is taking over the market prices. Mining could still remain profitable for the ones with access to cheaper electricity and operating costs.

“The increased hash rate means people are here for the long-term because they’re happy to just accumulate what they have, potentially even run at a loss,” said David Sapper, chief operating officer at cryptocurrency exchange Blockbid Pty Ltd. in Melbourne.
Source: Bloomberg - Justina Lee

Image source: bitinfocharts.com

The break-even price was estimated by several groups including research firm Fundstrat Global Advisors stating a price of $8000. Whereas Morgan Stanley have said that large mining farms make money only with Bitcoin trading above $8,600. Source: Bloomberg - Justina Lee.

With faster hardware capabilities and energy efficient mining components, profits generally would increase while operating costs drops. When more machines are working to solve these computational problems, the hash rate will continue to grow.

Image source: pixabay - congerdesign

To further understand the economics of Bitcoin mining, I have read through an article published on PLoSone journals. The article titled, "modeling and simulation of the economics of mining in the bitcoin market" simulates the Bitcoin market and how it affects traders, speculators and miners.

Although the article was dated before 2016, the "pre-bubble era", simulations show how miners gain advantage against traditional traders and speculators. Simulation results show that at some point, miners would gain more total wealth. The underlying assumption is that miners would continue to use their profits to re-invest in better mining hardware.

Image source: pixabay - tuproyecto

To think way beyond Bitcoin as a store of value in the financial market, Bitcoin may represent something larger. If energy is an finite resource, then we have already found a way to convert natural resources such as oil, gas and coal into electricity and to power our smart devices and lastly to store them as Bitcoins.

An article on bravenewcoin - Andrew Gillick pointed out that Bitcoin mining might cause the next energy revolution. As we continue to rely on traditional natural resources, Bitcoin's store of energy directly from electricity could mean that renewable sources of energy are preferable. This could give countries generating energy from wind, hydro-electricity an opportunity to be the next "oil" market.

Bitcoin is not as prone to the same economies of scale as these other energy dense commodities, nor is it as restricted geographically. With Bitcoin mining, the manpower needed is minimal and the machinery (computer farms) and the energy to run them are the only significant overheads - and they should come down with more powerful ASIC chips.
bravenewcoin - Andrew Gillick

As far as I have been over-thinking on this issue, I shall just put it here, and perhaps you could give me some comments how you think.

-tysler