- Bitcoin difficulty has ramped up to an all-time high following latest adjustment.
- Hash rate, a measure of computing power on the Bitcoin network, is also on the rise.
- Experts believe this could lead to some smaller miners capitulating.
The difficulty of mining a Bitcoin block ramped up by 3.6% today, marking an all-time high for the network. But the adjustment does put additional pressure on miners.
While not the most significant leap in difficulty adjustment history, the 3.6% hike brought Bitcoin's total network difficulty to a record high of 17.56 trillion (T). The last time network difficulty came close to that figure was in July.
#Bitcoin mining difficulty increased by 3.6% and is at an all-time high.
Chart: https://t.co/unDzaUVC17 pic.twitter.com/A00CuQvOJH
— glassnode (@glassnode) August 24, 2020
Bitcoin mining difficulty is adjusted approximately every two weeks. When blocks are being mined too quickly or too slowly, the difficulty adjusts to bring the speed back in check.
An upward adjustment in Bitcoin mining difficulty is typically linked to an likewise increase in network hashing power—the amount of computing power on the network.
Indeed, on August 15, Bitcoin's hash rate hit its own record high of 136 exahashes per second (EH/s). After a brief slump in the following week, the hash rate recovered to around 120 EH/s—apparently thanks to floods in China, a prime region for Bitcoin mining due to cheap hydroelectric power. And it’s set to continue breaking new highs.
Bad news for retail Bitcoin miners?
According to Thomas Heller, chief operating officer at Bitcoin mining firm HASHR8, the amalgamated rise of both hash rate and difficulty could spell trouble for less sophisticated miners.
"If difficulty and hash rate continue to rise, the old-gen machines will struggle to keep mining," Heller explained, adding, "The S9 is the most common machine still mining, and it's still profitable at $0.03/kWh power which is available for hosting in China right now. However, after October, when the rainy season is over, and hosting prices are $0.05/kWh+, then it's probable that S9s will not be profitable at that price point."
Per data from BTC.com, the next difficulty adjustment, penned for September 7, is estimated to bring yet another increase, this time by 3.5%, pushing Bitcoin's network difficulty to another all-time high and past 18 trillion territory. There’s all to mine for.