- The difficulty of mining bitcoin increased 3.9% on Tuesday, reaching a record high of 95.7 trillion.
- The Bitcoin network hit a record seven-day moving average hash rate of around 724 EH/s, which prompted the favorable adjustment.
Amidst record seven-day moving average hash rate levels for the network, Bitcoin mining difficulty increased 3.9% on Tuesday to reach a new all-time high. Blockchain explorer Mempool reports that the difficulty adjustment occurred at block height 866,880, surpassing the previous peak of 92.7 trillion established in early September to achieve a record of 95.7 trillion.
The difficulty of mining bitcoin is not quantified. It is a measure of how difficult mining a new block is in relation to how easy it could ever be. No matter how many miners are actively mining, the difficulty automatically changes every 2016 blocks, or about two weeks, to guarantee that a new block is discovered on average every ten minutes.
According to Clark Moody’s monitor, Bitcoin’s blocks were being mined at a faster-than-normal pace of one block every nine minutes and 37 seconds before to Tuesday’s modification.
A miner must expend more energy and computational resources to obtain the correct hash for the subsequent block as the difficulty increases. The difficulty of mining bitcoin increases as the number of miners increases. On the other hand, the protocol reduces the mining difficulty if there are less miners vying for new blocks, which makes it simpler for the miners that are left to find blocks.
The total hash rate of the Bitcoin network hits a record
Bitcoin’s hash rate, which gauges the total amount of processing power that miners provide to the network, also hit a new seven-day moving average all-time high of 723.6 EH/s on Monday, breaking 700 EH/s for the first time.
Bitcoin miners seem to be increasing their hash rate collectively after bottoming out at a seven-day moving average of 550.3 EH/s in June, despite initially falling after the cryptocurrency’s fourth halving event on April 20. This event saw block subsidy incentives halve from 6.25 BTC to 3.125 BTC.
After the halving, bitcoin miners’ earnings dropped significantly, from a seven-day moving average peak of $72.4 million on the day of the event to the $25–$35 million range afterward. This forced less productive miners out of the market.
This is further demonstrated by the fact that the hash price of Bitcoin dropped to its lowest point ever in September, hitting $0.04, but has since somewhat rebounded to $0.048. The estimated value of 1 TH/s of hashing power per day is known as the hash price, and it measures how much a miner can make at a certain hash rate.
Despite AI diversity, public miners are still gaining market share
Bitcoin’s overall network hash rate is increasing once more in spite of the more difficult conditions, as the remaining operators, who are mostly American public miners, start to expand their capacity, improve their mining equipment, and increase their market share.
VanEck, a spot Bitcoin exchange-traded fund issuer and investment management firm, reported on October 16 that publicly listed bitcoin miners now make up a record 30% of the network’s overall hash rate.
Because of this concentration, any additional shifts toward AI/HPC by the miners on this list could have a big impact on hashrate and difficulty globally. All else things being equal, mining becomes more profitable for the remaining players when mining is divested since it lowers the global hash rate and mining difficulty.
With the stocks of AI diversifiers like Core Scientific, IREN, and Terawulf outperforming their pure-play bitcoin mining equivalents like CleanSpark, Riot, and MARA, the tactics of bitcoin miners have changed significantly in 2024.
Due to their lucrative pipeline of power contracts, AI diversifiers have profited from the growing demand for high-performance computing and AI data center hosting services. However, pure-play companies have contended that, given a possible bull run for the leading cryptocurrency as it reapproaches all-time highs of almost $74,000, the return on bitcoin mining’s less expensive equipment and rapid energization is significantly quicker than AI gestation times.
Disclaimer : This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments.
