Bitcoin Difficulty is set to go up again on Thursday, extending the streak of positive adjustments to six and paving the way for a new record.
Bitcoin Difficulty Is Expected To Go Up 4.9% In Next Adjustment
The “Difficulty” refers to a feature on the Bitcoin blockchain that controls how hard miners would find it to mine on the network right now. The metric’s value automatically changes about every two weeks in events known as adjustments.
The chain changes the Difficulty based on the speed at which miners performed their duty since the last adjustment. If miners mine blocks at a rate faster than 10 minutes per block, then the network responds with an increase in the Difficulty. The jump is just enough to bring the miners back to the standard rate of 10 minutes per block. Similarly, if miners are finishing their task at an average rate slower than the chain needs, the metric’s value declines in the next adjustment.
The next Difficulty adjustment is currently estimated to occur on Thursday. Below are the details related to it, according to CoinWarz.
Looks like the indicator's value is about to go up tomorrow | Source: CoinWarz
As is visible, the Bitcoin miners have been producing a block in an average time of 9.53 minutes during the last two weeks. This is significantly faster than the network wants them to be, so now the Difficulty will go up sharply.
CoinWarz estimates that the increase will be of 4.9% and will take the metric to a new all-time high (ATH) of 142.7 trillion hashes. Until now, the last five adjustments have been positive ones, so this next one would extend the streak to six.
The trend in the BTC mining Difficulty over the last twelve months | Source: CoinWarz
The last three jumps all also resulted in new ATHs, meaning that miners have been dealing with a record-high level of Difficulty for six weeks now, with at least another two weeks of hardship ahead judging by how the next adjustment is looking to go.
As mentioned before, the Difficulty rises in response to miners becoming faster at their task. This happens when these chain validators add additional computing power to their facilities.
The aggressive upward adjustments in Difficulty lately are a result of the same. As the below chart from Blockchain.com shows, the total computing pool of the miners, known as the Hashrate, has been exploring new records on the 7-day average recently.
The value of the metric seems to have shot up in recent days | Source: Blockchain.com
Generally, Difficulty increases tend to slow down growth in the Hashrate as miners already barely making a profit can get pushed over the edge by them. This cohort hasn’t cared for the last five Difficulty jumps, however, so it will be interesting to see how it reacts to this latest one.
BTC Price
Bitcoin recovered above $117,000 earlier in the past day, but it seems the coin has faced a pullback since then as it’s back at $115,600.
The price of the coin seems to have been moving sideways over the last few days | Source: BTCUSDT on TradingView
Featured image from Dall-E, Blockchain.com, CoinWarz.com, chart from TradingView.com
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