hashrate declining means less miners connected to the network and lower cost of mining. It is part of the game theoretical process of balancing between cost of mining and price of bitcoin. In theory the network becomes less secure when the hashrate goes down (it becomes less expensive for 51% attack). Of course it is still a long way from being any real threat, but if the spiral continues down in a negative feedback loop (Bitcoin price goes down > bitcoin mining becomes less profitable > miners leave the network > hashrate goes down > trust in network goes down > price of bitcoin goes down > etc.) in theory the mining difficulty could become so low that attacking the network could become real reality, because the network just becomes too insecure. At some point the price of bitcoin would need to reverse and go in an uptrend again, before the spiral becomes problematic or irreversible. Because then mining becomes more profitable again, new miners enter the market and the hashrate would go up.
The reason that I mentioned the hashrate to finally stabilize, was that it seemed so unusual that hashrate was still increasing despite the fact that bitcoin price has been down for so long already, which would suggest that it goes against the game theory. Another theory could be that initially the price during bull market went up so fast that mining cost could not keep up, which gave miners such a fat margin that despite the huge price drop in the bear market, mining was still profitable enough and had still room for the hashrate to grow. Perhaps now we have come to a point that the hashrate has gone up enough to make mining on or below break-even finally, which means that only since recently it has become less interesting for miners to add new equipment to the network. Which would be another theoretical explanation.
Either way, as long as the hashrate doesn't start dropping too far and nor does the bitcoin price, in such a way that it doesn't become problematic, we should all be fine!
