Bitcoin hash rate drops by 12%! A snowstorm in the United States paralyzes mining farms, marking the largest decline since China's ban.

The US winter storm has impacted mining farms, causing Bitcoin’s total network hash rate to plummet by 12% to 970 EH/s, the largest decline since China’s mining ban in 2021. Extreme cold has led to power shortages, prompting many miners to limit power consumption or shut down their operations. Daily mining revenue has fallen from $45 million to $28 million, while the daily production of listed mining companies has decreased from 77 BTC to 28 BTC. The profit and loss index has dropped to 21, indicating a potential for larger difficulty adjustments ahead.

Extreme Weather Triggers Epic Bitcoin Hashrate Collapse

(Source: CryptoQuant)

According to on-chain data firm CryptoQuant, Bitcoin’s total network hashrate has sharply decreased by approximately 12% since November 11, 2022. Currently, it stands at only 970 EH/s, the lowest since September 2025. This is the largest single drop since China’s comprehensive mining ban in October 2021, when large-scale migration of Chinese miners caused the network hashrate to halve within weeks, dropping over 50%.

This retreat in Bitcoin’s hashrate began worsening rapidly last week. Extreme cold affected several major mining hubs in the US, including Texas, North Dakota, and Montana, with temperatures plunging to -20 to -30°C, setting decade-long record lows. To protect equipment and comply with “power restriction requirements,” many listed miners chose to temporarily shut down their rigs. Such collective shutdowns are extremely rare in Bitcoin mining history; the last similar scale event occurred during China’s forced closures in 2021.

Texas, the largest Bitcoin mining hub in the US, bore the brunt of this storm. ERCOT, the state’s grid operator, activated emergency demand response plans, requiring large industrial electricity consumers—including crypto mining farms—to significantly reduce power usage to prevent grid collapse. Texas miners typically have agreements with the grid to receive compensation for outages during shortages, but this compensation is far below normal mining profits. It is estimated that over 70% of Texas’s total hashrate has shut down, and Texas’s share of the US total is about 30%, making the impact on the entire network’s hashrate very significant.

North Dakota and Montana face similar severe conditions. These regions’ mining farms usually leverage abundant wind power, but extreme cold causes turbines to ice up and stop, drastically reducing power supply. Some farms want to continue operating but are forced offline due to freezing temperatures causing cooling system failures or equipment breakdowns. Operating mining rigs in such extreme cold increases hardware damage risks, leading many miners to temporarily shut down, waiting for temperatures to rise.

Mining Revenue and Output Collapse Simultaneously

(Source: CryptoQuant)

The sudden decline in Bitcoin’s hashrate immediately impacted miners’ revenues. Data shows that daily total mining income fell from about $45 million on January 22 to $28 million within two days, hitting a one-year low. Although it has slightly rebounded to around $34 million, it remains well below recent averages, reflecting dual pressures from declining hashrate and weakening coin prices.

Mining output also shrank sharply. The daily BTC production of listed miners decreased from 77 BTC to just 28 BTC, a 64% reduction; small and medium miners’ output fell from 403 BTC to 209 BTC, nearly 48% less. This collapse in production directly impacts miners’ cash flow, with many small and medium miners potentially facing liquidity crises.

Using a 30-day moving average, the production of listed miners decreased by 48 BTC since the last halving in May 2024—the largest decline since then; non-listed miners’ output fell by 215 BTC, the biggest drop since July 2024. This ongoing decline indicates that Bitcoin’s hashrate issues are not just short-term weather effects but also reflect a structural adjustment within the mining industry.

Triple Chain Reaction of Bitcoin Hashrate Collapse

Revenue side: Daily revenue drops from $45 million to $28 million, tightening miners’ cash flow

Production side: Listed miners’ daily BTC output falls from 77 to 28 BTC, causing supply shortages

Cost side: Electricity and maintenance costs remain fixed, but revenue plunges, causing unit costs to soar

More concerning is that miners’ survival margins are being squeezed to the limit. CryptoQuant’s “Miner Profit and Loss Sustainability Index” has fallen to 21, the lowest since November 2024, indicating that more miners are “unprofitable.” Despite multiple difficulty adjustments, mining revenues still struggle to cover high electricity and maintenance costs.

This index considers various factors such as Bitcoin price, network difficulty, electricity costs, and equipment efficiency. Values below 30 generally indicate mining is in loss, below 20 suggests large-scale miners face shutdown risks. The current reading of 21 shows that miners using older hardware or paying higher electricity rates are already operating at a loss per BTC mined. If this situation persists, it will trigger another wave of industry reshuffling, with only well-capitalized, technologically advanced large miners surviving.

How Will Difficulty Adjustment React?

Although recent difficulty has been slightly lowered due to some miners going offline, it’s not enough to offset the impact of falling coin prices and operational disruptions. If Bitcoin’s hashrate remains low, larger difficulty reductions are expected in the coming weeks, providing some relief for remaining miners.

Bitcoin’s protocol adjusts mining difficulty every 2,016 blocks (roughly biweekly) to maintain an average block time of 10 minutes. When many miners shut down, network hashrate drops, slowing block production. The next difficulty adjustment cycle will automatically lower difficulty, making it easier for remaining miners to find blocks. This self-regulating mechanism can stabilize mining, but it depends on timing.

Based on current hashrate decline speed, the next difficulty adjustment (around mid-February) is expected to reduce difficulty by 8% to 12%. This would be one of the largest single adjustments in recent years, reflecting a significant supply-demand rebalancing. After difficulty drops, remaining miners’ efficiency improves, allowing them to mine more BTC per unit time, boosting revenues.

However, the lag in difficulty adjustment is the biggest challenge for miners. From the moment hashrate declines to when difficulty adjusts, about two weeks pass. During this window, miners face high difficulty, low hashrate, and weak coin prices—making it the toughest period. Only those who endure this “darkest hour” can benefit from the subsequent easing of difficulty.

Post-Storm Reshaping of the Mining Landscape

The impact of the US blizzard on Bitcoin’s hashrate could mark a turning point for industry reshuffling. Miners heavily reliant on single-region power supplies and lacking contingency plans exposed vulnerabilities during this crisis. Conversely, large miners with diversified regional operations and flexible grid cooperation can minimize losses through regional adjustments and demand response plans.

Long-term, this event may accelerate two major trends. First, geographic diversification: the over-concentration of hashpower in the US will prompt miners to reassess global deployment, with regions like the Middle East, Central Asia, and Africa—rich in energy and with stable climates—becoming more attractive. Second, energy infrastructure upgrades: miners will invest more in their own power facilities or renewable energy sources to reduce dependence on public grids.

In the weeks following the storm, Bitcoin’s hashrate is expected to gradually recover. As temperatures rise and grid pressures ease, shutdowns will restart. Coupled with difficulty adjustments improving mining efficiency, the industry might see a rebound by March. But the lessons learned from this crisis will have lasting impacts: Bitcoin mining is not just a technical and capital race but also a test of risk management and resilience.