What Is the Correlation between a Coin’s Market Capitalization and Its Total Hashrate?

There is a strong, though not perfect, positive correlation between a coin's market capitalization and its total hashrate. A higher market cap suggests a higher value for the block rewards and transaction fees, providing a greater economic incentive for miners to invest in hardware and secure the network.

This increased hashrate, in turn, makes the network more secure, which reinforces investor confidence and contributes to a higher market cap. This creates a positive feedback loop, though hashrate can lag behind price movements.