Bitcoin Mining Difficulty Hits a New All-Time High

By Will McCurdy

It’s just gotten even harder to mine Bitcoin.

Bitcoin’s mining difficulty has hit a new all-time high, rising roughly 4.68% from 37.59 trillion on Sunday to 39.35 trillion at the time of writing.

Mining difficulty is the figure representing the computational power required to mine a single BTC. It’s updated roughly every two weeks, getting more difficult as more miners enter the network and easier when they leave.

Bitcoin mining difficulty over the past month. Source: CoinWarz.

Mining difficulty has been climbing strongly and steadily over the past year, despite temporary decreases, such as in the month of December 2022.

On January 30, 2022, the mining difficulty sat at 26.24 EH/s as per the data from CoinWarz, but it has since risen to 39.35 EH/s, a roughly 50% increase. 

Meanwhile, Bitcoin’s hash rate, which measures the amount of computational power dedicated to mining the cryptocurrency, currently sits at 305.81 ExaHashes per second (EH/s). This figure is still below the all-time high registered on January 6 of 348.7 EH/S.

The current hash rate means Bitcoin miners are currently making over 305 quintillion codebreaking attempts every second in attempts to solve the computational equations needed to produce the proof-of-work (PoW) cryptocurrency. 

This time last year, Bitcoin’s hash rate was roughly 182.37 EH/s, making for a total increase of over 67% to the time of writing. 

Bitcoin hash rate from January 31, 2022, to the present. Image: CoinWarz.

Despite both Bitcoin’s mining difficulty and hash rate spiraling up throughout 2022, the price of the end product hasn’t kept pace. 

The price of Bitcoin, as per CoinGecko data, has declined from $38,232 on January 30, 2022, to $23,211 today, marking a roughly 39.3% decline.

Bitcoin miners in difficulty

This isn’t good news for some in the Bitcoin mining industry, a larger mining difficulty means more advanced machinery, more computers, and more power might be needed to produce the same amount of Bitcoin.

And if the price of Bitcoin isn’t rising at a comparable pace to the mining difficulty, this could make mining a less profitable business. 

Already bankruptcy and debt restructuring news has cropped up almost weekly in recent months. 

In December 2022, Core Scientific, one of the largest publicly-traded U.S. mining companies declared bankruptcy. 

Another major mining firm, Greenidge Generation has gone on record as saying that their continued viability is in “substantial doubt. 

It’s not just low Bitcoin prices and higher miner difficulties putting stress on these firms. Industrial energy prices shot up 16% between 2021 to 2022, which has spelled trouble for firms running fleets of energy-intensive mining machines.

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