Bitcoin's computing power dropped 19% since November, falling from 1,108 EH/s to 898 EH/s. Glassnode data shows this nine-month decline is the longest in the network's history. The slide coincides with the largest capital migration miners have ever staged. Public mining firms hold over $70 billion in AI contracts, and converted capacity may never return.

A Different Kind of Collapse

Bitcoin has seen only two comparable hash rate drawdowns in its modern era. The 2021 China mining ban crushed the network by 42%, dropping from 165 EH/s to 95 EH/s over ten weeks. The 2024 post-halving purge shed 8% in three months as inefficient rigs got replaced. Both reversed quickly. The current slump is not reversing at all.

In absolute terms, the network has shed roughly 210 EH/s. That is more hashpower than the entire network possessed in early 2021. The 30-day average shows no bottom formation heading into August. The squeeze has already claimed casualties. Poolin, once the world's largest mining pool, filed for Chapter 11 protection in late July.

Difficulty Turns Negative for the Second Time Ever

Network difficulty now sits 1.1% below its level one year ago. That is the first negative year-over-year reading since August 2021, when China's ban drove the metric to −21.2%. Difficulty has printed sub-zero annual readings only twice in Bitcoin's history. Both red zones mark a mass departure of miners, but the mechanics could not be more different.

The 2021 dip was violent but temporary, because the rigs survived and simply changed address. Miners scattered their hardware across the US and Central Asia. The 2026 version is shallower but structural. Miners are signing 12 to 20-year AI hosting leases on the same power capacity that once ran ASICs. These long-term commitments suggest the hashpower exodus is not a temporary pullback but a permanent reallocation of resources away from cryptocurrency.

This material is informational only and should not be considered financial advice. Mining economics and network dynamics are subject to rapid change.