Recent data have left analysts optimistic about what the future holds for Bitcoin and the largest altcoin Ether (ETH).
Miners may be paying no attention to the recent BTC price slump as on-chain data suggests that mining difficulty has hit new all-time highs. In the past week, BTC/USD has dipped by at least 11%, however, bitcoin miners have somehow retained their confidence in the asset class.
Bitcoin mining difficulty, which has been on a downward slope for a while now, has suddenly picked up. In its latest biweekly automated readjustment on August 22, network activity shows the difficulty to have surged over 6%. And, interestingly, that amount of surge was enough to take difficulty to new record highs.
According to monitoring platform BTC.com, Bitcoin mining difficulty has now seen its sixth-largest rise of 2023.
Bitcoin Mining Difficulty Suggests Profitability
For what it’s worth, mining difficulty refers to the amount of competition encountered during mining activities. And, ultimately, it also reflects how profitable the mining business is at every point in time. That is, competition will be relatively low when the network is not as profitable, and vice versa.
In line with this view, it might be safe to say that miners are not yet struggling in terms of profitability. Hence, the upward movement of the mining difficulty that was just recorded.
From all indications, even the next automated readjustment is also expected to continue the trend. So, the difficulty might be crossing the 56 trillion mark for the first time.
Meanwhile, it might also be worth noting that difficulty is not the only network fundamental that is currently signaling a “high confidence” in BTC. The hash rate is another indicator. Currently, has rate is pushing to surpass the existing all-time highs of over 400 exahashes per second (EH/s).
All these data have left analysts optimistic about what the future holds for Bitcoin and the largest altcoin Ether (ETH). According to MAC_D, a contributor to the on-chain analytics platform CryptoQuant, there’s an aura of confidence among participants over the security and reliability of BTC and ETH networks. In a Quicktake market update, MAC_D submitted partly:
“The fact that the price has fallen despite the increase in the intrinsic value of the two assets means that they are undervalued, and it can be considered a time to actively accumulate assets.”
Meanwhile, there has also been a slight increase (0.08%) in the amount of BTC held that is held by mining entities. That is since the start of August.
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