There seem to be a direct correlation between the people wanting to mine and the price of Bitcoin. The $1000 price tag certainly helped to gather more interest at the time.
It also sparked the creation of more Bitcoin farms on a much bigger scale than before. The competition and total hashing power increased to such high levels that most solo
mining operations were pushed to "pool mining" to stay profitable. The higher price just make mining more profitable and more people will start doing it, if the reward is higher.
As more people mine, the difficulty also goes up. The profitability is reduced after some time. When the price suddenly when up, most just turned their old ASIC on and continued till it unprofitable. The hashrate hasn't been increasing due to the fact that the price dropped significantly. It was profitable for a larger group of people and a good portion of the people have lost money as the electrical prices is too high when the price dropped by 80%.
