Bitcoin’s mining difficulty approaches all time high
Over the last 3 months, Bitcoin’s hashrate has been getting higher and higher, inching toward its all-time high (ATH) of around half a year ago, Bitcoin.com wrote. Network difficulty is increasing because of the accelerated hashrate. The flagship crypto’s mining difficulty has gone up nine times in a row so far, closing in on the network difficulty ATH recorded on May 13, 2021.
Difficulty makes system stronger
Satoshi Nakamoto added network’s difficulty as a mechanism to maintain a steady rate of around ten-minute blocks. In addition, the difficulty improves the entire system security. An attack of just 51% becomes a lot harder and costlier to go through with.
Mining difficulty increases with a higher rate and vice versa
The hashrate changes twice a month. When it does, the network reflects the change. Bitcoin mining difficulty is proportional to the hashrate. When one increases, so does the other.
Correspondingly, when one drops, so does the other. When the Chinese government cracked down on mining this summer, the hashrate took a dive. Then, Bitcoin became easier to mine. This year, BTC’s hashrate plummeted and the mining difficulty dropped by almost 40% in different intervals.
Difficulty dropped by 4T in 2 weeks
The difficulty’s ATH on May 13 was around 25.05 trillion. It was 4 trillion less just two weeks later. In July, it dropped to a new low of just 13.6 trillion. At the beginning of that month, it underwent the most major downward difficulty adjustment in the lifetime of the network.
At a block height of 689,472, the huge downward drop was almost 28%. At the time of writing, the king of crypto’s mining difficulty is just under 22.7 trillion. It is fast approaching its ATH of 25.05 trillion.
Bitcoin will keep getting harder to mine
To reach a new ATH, the mining difficulty needs to grow by more than 10%. In the near future, Bitcoin will be harder to mine than it was half a year ago. It has every chance to break its record considering current SHA256 profitability rates.
As the price of Bitcoin rises, mining becomes more attractive, and more people get in on it. Then, its difficulty increases. So do the profits for everyone involved. Microbt Whatsminer M30S++, Ipollo’s B2, and other ASIC Bitcoin mining rigs make more than $25 a day despite paying electric power costs of $0.12/kWh. Ethereum is an equally prominent energy guzzler.