Bitcoin’s mining difficulty surged by 6.2% on Tuesday, reaching an all-time high of 101.7 trillion at block height 868,896, according to Mempool. This marks the first time the difficulty has crossed the 100 trillion threshold, breaking the previous record of 95.7 trillion set just two weeks ago.
Understanding Mining Difficulty and Hash Rate
Bitcoin’s mining difficulty adjusts every 2016 blocks — roughly two weeks — to maintain a block discovery rate of approximately 10 minutes, regardless of the number of active miners. Before the latest adjustment, blocks were being mined at a faster-than-average rate of one every 9 minutes and 27 seconds, indicating a need for increased difficulty.
The network’s hash rate, which measures the computational power miners contribute, recently hit a record seven-day average of 755.5 EH/s, surpassing the 750 EH/s milestone for the first time. This reflects a collective ramp-up in mining power, with operators deploying advanced mining rigs and consolidating market share.
Halving’s Impact on Miners
Bitcoin’s fourth halving event on April 20 reduced block rewards from 6.25 BTC to 3.125 BTC, causing miner revenues to plummet. Daily earnings dropped from $72.4 million at the halving peak to a range of $25 to $35 million, forcing less efficient miners out of the market. Hash price, the value of 1 TH/s of hashing power per day, hit an all-time low of $0.04 in September before slightly recovering to $0.045.
Despite the economic squeeze, miners are investing in more efficient hardware, such as Bitmain’s 21 series, and exploring off-grid and international power sources to lower costs. Ethan Vera, COO of Luxor Technology, noted that these developments signal a long-term bet on improved mining profitability.
Mining Stocks Diverge
In 2024, public bitcoin miners have pursued varied strategies, with AI-integrated firms like Core Scientific, IREN, and Terawulf outperforming traditional miners like CleanSpark, Riot, and MARA.
Bitcoin, currently trading at $68,694, is down 4% over the past week but up 63% year-to-date, showcasing resilience amid evolving market dynamics.
