Bitcoin Mining Difficulty Hits New All-Time High of 55.64 Trillion Hashes – Why This is Bullish for the BTC Price

The Bitcoin mining problem, a measure of how tough it’s to mine a block, simply hit a brand new all-time excessive at 55.62 trillion hashes, as per CoinWarz.

The Bitcoin mining problem is mechanically adjusted by the protocol as soon as each two weeks, or as soon as 2,016 blocks have been mined, with these block intervals known as epochs.

The Bitcoin community goals for it to take 10 minutes to mine every block.

If mining exercise rises throughout one epoch, bringing the typical time to mine a block down from this 10-minute goal, the community mechanically adjusts the mining problem larger on the finish of the epoch.

Likewise, if the typical time to mine a block rises above 10 minutes throughout an epoch, the problem can be decreased.

The mining problem at an all-time excessive is a direct reflection of the rising computing energy of the Bitcoin community, as extra miners enter the market to achieve a share of the community’s Bitcoin issuance (6.5 BTC per block) and transaction charges.

Certainly, the hash price (a measure of computing energy) of the community reached an all-time excessive of round 414 TH/s earlier this month, as per Blockchain.com.

That’s a bounce of greater than 60% for the reason that begin of the 12 months.

Right here’s Why a Rising Problem is Bullish for Bitcoin, In line with Bitfinex

Bitcoin’s rising problem is bullish for the worth, argue analysts at Bitfinex.

“Bitcoin problem rising can recommend that miners consider that the present value demonstrates that the present value of Bitcoin suggests a downwards deviation within the true worth of Bitcoin,” analysts on the change instructed Cryptonews.com.

“Miners could possibly be assured that the worth of Bitcoin will ultimately rebound as this may be seen as a mere downwards deviation from its actual worth… Therefore investing extra assets to mine Bitcoin at these costs could possibly be extremely worthwhile to them”.

Miners are vital holders of the Bitcoin provide and, if they’re assured that costs are going to rise, this might scale back provide from a key section of the bitcoin market.

Bitcoin (BTC) is presently on the right track to finish August greater than 10% decrease, its worst month of the 12 months to date.

The cryptocurrency, last near $26,000, came under pressure this month after 1) macro headwinds amid rising US yields and falling US inventory costs and a couple of) technical promoting after falling beneath its prior 2023 uptrend and 200DMA.

That has seen the cryptocurrency unwind its June/early July features made amid optimism a couple of potential spot Bitcoin ETF approvals later this 12 months/in early 2024.

However many assume that the Bitcoin value gained’t keep at suppressed ranges for lengthy – not solely are spot ETF approvals expected to spur institutional adoption in 2024, however the Bitcoin halving can be developing (traditionally a bullish catalyst) and a Fed interest rate cutting cycle also appears to be on the horizon (maybe for the second half of 2024).

Bitcoin sometimes hits new all-time highs inside a 12 months of the halving (the following one is subsequent April).

Given this is able to mark features of practically 3x from present value ranges, maybe it isn’t stunning that Bitcoin miners are doubling down and investing.