Bitcoin mining difficulty posts steepest drop in history

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The Bitcoin blockchain suffered its biggest drop in mining difficulty, as the automatic network stabilization mechanism was triggered following a strict crackdown by China on the country’s cryptocurrency industry. country.

Bitcoin mining difficulty plunged nearly 28% to block 689,471 at 6:25 am UTC.

The adjustment marks the third consecutive decline in mining difficulty, the first time such a trend has occurred since December 2018. On May 29 and June 13, mining difficulty fell by 16% and 5 %, respectively, according to mining service provider BTC. com.

Bitcoin difficulty is measured using an internal score that started at 1 (when Satoshi started mining at the easiest level). It is programmed to increase or decrease gradually depending on the number of minors competing on the network. It is currently valued at 14,363,025,673,659, compared to 19,932,791,027,262.

Blocks are added to the Bitcoin blockchain at a steady and predictable rate: 1 block every 10 minutes or so. Block time measures the time it takes to create a new block, but this rate can vary depending on the number of miners on the network and the speed of their computers. When there are more miners competing to “find” the next block and earn the 6.125 BTC reward, then those blocks tend to be resolved faster. However, when the miners leave the network, leaving fewer miners to compete, block times can slow down.

The Bitcoin algorithm is programmed to automatically adjust the difficulty level every 2,016 blocks, or approximately every two weeks, in order to maintain a target block time of 10 minutes.

During this most recent period of difficulty, the average hashrate, a measure of the total computational power brought to the blockchain through mining, stood at 87.7 exahashs per second, the lowest since December 2019. This is down from a peak of around 180 exahashs per second in mid-May.

As a result, bitcoins mean the blocking time has slowed down considerably, with some blocks taking up to 23 minutes on Sunday, June 27, although the network appears to have accelerated slightly since then.

Today’s drop in difficulty will make it easier for remaining miners to find blocks at a pace closer to the 10 minute goal.

“The difficulty adjustment also has some interesting properties in the real world, especially for miners,” said Will Foxley of Compass Mining. “When the difficulty decreases, you earn more bitcoin if you can stay online. When it increases, you earn less because more miners participate. “

Miners that remain operational are likely to become even more profitable in the coming weeks, unless prices correct further or the hashpower migration comes back online, Glassnode wrote in a report.

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