Bitcoin's Computing Power in Decline Amidst Mining Profitability Issues

The Bitcoin network's computing power has been in decline since its peak at the end of 2025. Rapha Zagury, CEO of Twenty One Capital, describes this situation as the first 'bear market of the hashrate.' The main cause is the deterioration of mining profitability, which has led to a significant drop in the number of machines operating on the network.

The decline in computing power has also been amplified by artificial intelligence. Many operators have dedicated their energy infrastructures to long-term computing contracts for AI and high-performance computing. This trend is evident with major players like Keel Infrastructure, Bitdeer, and Hut 8, which have signed large-scale contracts for AI-related projects.

However, it's worth noting that the decline in hashrate does not necessarily translate to a reduction in the number of Bitcoins issued. The protocol adjusts the difficulty approximately every two weeks to maintain a block every ten minutes. This means that miners who remain active can potentially obtain a larger share of the rewards if their competitors suspend their machines.