What does computing power represent (What is the unit of computing power)?

08/19/2023 09:54 • Daily Digest • 58 views

What does computing power represent? The price of Bitcoin reached its all-time high in 2017, but has now fallen to a low point. Data shows that the average computing power of Bitcoin is currently about 2 exahashes (EH/s) per second.

However, this does not affect its price rise. Because it has significant differences compared to other digital currencies: for example, the price of ETH on Ethereum plummeted by more than 50% during its surge in 2018, while Bitcoin network operates with mainstream cryptocurrencies like EOS.

From this perspective, as the cryptocurrency market matures and blockchain applications become more diverse, the mining industry is moving towards more efficient directions. Therefore, more and more traditional financial institutions are joining this new capital feast.

According to coindesk data, as of June 17, a total of 30 trillion dollars’ worth of assets are locked in DeFi protocols globally. The majority of these funds are generated through lending, including large exchanges, insurance companies, token issuers, and more, and these investors’ assets primarily come from bank deposits, transaction services, and stock markets. Additionally, many renowned investment institutions from around the world have also participated in this bull market round.

Although many early investors have shown interest in the price performance of BTC, the actual situation may not be very optimistic. If we attribute all the gains to BTC’s long-term trend, we have to consider whether Bitcoin’s future performance will be excellent or if it can continue to exist.

In fact, despite the recent belief that the value of cryptocurrencies will not decline or disappear, there are significant driving factors behind it. For example, Bitcoin has a supply limit of 21 million coins, which means that only 21 million BTC can circulate. So, for Bitcoin, this growth may make it a viable alternative.

However, analysis also points out that due to the current market conditions and price trends of Bitcoin, there is an increasing demand for ordinary people to buy Bitcoin and engage in speculative operations. On the other hand, as more individual users enter Bitcoin and do not increase their holdings as in the past, the quantity will decrease. The “buyers” are no longer simple seller roles, but people with less cash flow, meaning the “sellers” do not have enough money to buy Bitcoin as a “buy order”.

Another point to note is that the price of Bitcoin often fluctuates. When the total demand for Bitcoin exceeds the supply, it can cause inflation. However, if BTC is viewed as another type of commodity, this unstable sentiment can easily trigger significant price surges. In other words, if BTC continues to oscillate at high levels and the downward trend weakens, the price will experience a sharp rebound.

What is the unit of computing power?

Computing power is a unit used to measure the computational capacity in a network. When a computer processes a large amount of data, it consumes a certain amount of energy to complete the task, which cannot be utilized by other software systems. For example, the mining difficulty of Bitcoin largely depends on operational efficiency and electricity costs, while Ethereum, on the other hand, is responsible for maintaining each node (such as users) in the network and receives rewards based on their contributions. Units of computing power include CPUs, GPUs, and other types of data. (Chain News)

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What does computing power represent (What is the unit of computing power)?

What is the unit of computing power?

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