The difficulty of BTC mining has again adjusted upwards
2 min readAfter a series of four negative adjustments to the difficulty of BTC mining (mininig difficulty), the second in a row took place in the direction of a positive trend. This suggests that the extraction of the most famous cryptocurrency on the market is returning to “normal”.
Mining difficulty, or rather the difficulty of mining, is automatically adjusted once every 2016 mined blocks in order to make the average time for extracting one block 10 minutes (it takes an average of 2 weeks to extract 2016 blocks). The difficulty adjustment takes into account the current hashrate, or the total computing power expended in BTC mining. If the hashrate has grown over the period, the difficulty will increase and vice versa.
The difficulty of mining first reached a record high in May, when it increased in a single adjustment by up to 21.53%. It was a period when the price of BTC rose sharply to historical highs and the miners’ efforts to extract new Bitcoins escalated.
Subsequently, however, there were four negative adjustments in a row due to a sharp drop in the hashrate (-16%, -5%, -28%, -5%). This was caused by reports of a ban on BTC mining in China, which had a dominant position in this segment so far, as it accounted for more than 50% of the total BTC hashrate.
The first upward adjustment of mining difficulty took place about 2 weeks ago – on July 31, when the difficulty of mining increased by +6%. With the latest adjustment of 13 August (+ 7.31%) This is an increase in difficulty of more than 13% since the era of sharp hashrate declines associated with the cessation of BTC mining in China. At the same time, the BTC.com portal estimates that at the current rate of mining (hashrate), there will be another plus adjustment in about a week and a half, during which the difficulty will increase by another 4 percent.
The positive trend encourages the market
Mining difficulty and hashrate are indicators that to a large extent testify to the confidence of miners in the growth of the price of BTC in the current market conditions. However, the sharp decline in the BTC hashrate in May was not caused by a cooling of interest in BTC mining, but by legislative steps by the Chinese government.
The current trend of re-growth of hashrate and subsequently mining difficulty confirms that interest in BTC mining is growing again, which is a good signal for the entire market. The growth of the hashrate is related to several aspects, but especially to the fact that Chinese miners who have left their “homeland” are already gradually engaging their mining hardware in other countries – especially in Kazakhstan, Canada, the USA and Russia.
Foundry CEO Mike Coyler added that BTC’s hashrate (and subsequently mining difificulty) is likely to continue to grow until the historical highs of May 2021 are exceeded. Chinese miners into play, but also because the new mining hardware is more efficient for mining and with the same electricity consumption can generate higher computing power.
