Bitcoin’s Mining Difficulty Hits Highest Point Since January 2018
After two consecutive decreases in mining difficulty post-halving, Bitcoin’s mining difficulty increased by 14.95% on Tuesday, June 16, data from BTC shows.
Mining difficulty measures how hard it is to mine a Bitcoin block. Increased difficulty means miners need more power, which imposes a greater cost, to earn a reward. Tuesday’s adjustment marks the seventh largest difficulty increase in the past three years.
Mining difficulty is adjusted every 2016 blocks — every two weeks — to keep the average time between blocks at 10 minutes. After the difficulty adjustment on Tuesday, average block time dropped from 11 minutes to just under 9 minutes.
The recent difficulty adjustment comes after two consecutive decreases in difficulty of -6.00% and -9.29% respectively, which immediately followed Bitcoin’s halving on Monday, May 11.
The halving cut rewards for miners down from 12.5 Bitcoin per block to 6.25 Bitcoin per block, forcing less efficient miners to shut down operations. This slashed competition allowing efficient miners to earn more frequent rewards. Over the past twelve days, more mining hash rate came online than any other difficulty adjustment period, Cryptowatch tweeted.
However the consecutive decreases in difficulty from the past month allowed miners on older, less efficient equipment who shut down following the halving to open back up. If difficulty continues to increase, miners which fail to adapt with more cost-efficient machinery will likely shut down for good.
By Emily Mason