By
Bena Ilyas
April 25th, 2024
Despite concerns about profitability, however, some believe that higher mining difficulty could be a good sign for the network.
Bitcoin mining difficulty has reached a new all-time high of 32.05 trillion hashes following a 3.45% jump per data from BTC.com. The jump which took place at a block height of 753,984, represents its second in as many weeks and a fourth consecutive spike in a row. Recall that just two weeks ago, on August 31 precisely, the difficulty also saw a 9.26% spike.
Mining Difficulty: A Growing Concern for Miners
Expectedly, the high bitcoin mining difficulty is of great concern to crypto miners whose profitability keeps narrowing recently. More so, BTC price continues dipping uncontrollably, even as inflation levels are now confirmed to be on the high side.
For what it’s worth, the concerns of miners might be genuine, to say the least. This is because an increased mining difficulty translates to needing more computing power (and energy). And seeing as the value of Bitcoin is presently on a downward spiral, miners could face slimmer profits. But maybe not all miners are in this position.
According to Fred Thiel, CEO of Nasdaq-listed bitcoin miner Marathon Digital Holdings, some miners will likely benefit from the mining difficulty situation. He said:
“Those miners who are well positioned, well capitalized and can operate from a position of strength are going to benefit from this.”
Despite concerns about profitability, however, some believe that higher mining difficulty could be a good sign for the network. For example, Scott Norris, co-founder of the private Bitcoin miner LSJ Ops, believes that when the mining difficulty is high, it means that more miners are getting on the network – making it more efficient. Back in. August during the 9.26% jump, he said in part:
“A difficulty increase is an indicator of a strong and growing network, it’s actually a good thing.”
Meanwhile, the average hash rate remains slightly below the ATH of 231 EH/s at 229.39 EH/s.
Mining difficulty measures the complexity surrounding the mining of a bitcoin block or finding a hash below a set target. Invariably, this means that the higher the difficulty, the less likely it is for a miner to successfully solve the hash problem and earn bitcoins. The difficulty varies approximately every 2,016 blocks (roughly every two weeks) in sync with the network’s hash rate.