The next mining difficulty adjustment is set to take place on May 31 will mark an all-time-high for the automated Bitcoin mining metric.
The Bitcoin difficulty level, a metric that measures the ease with which new blocks are added to the blockchain, has doubled in two years.
Mining difficulty upward revision
Data from coinawarz shows that the difficulty level now sits at 49.5 trillion, and is expected to jump 3.1% to 51. trillion on May 31. The upward revision corresponds to the increasing hashrate across the network, ensuring the time to mine another bock averages out at 10 minutes.
The increased level of difficulty means more competition, lowering profit margins for miners. Bitcoin mining firm Marathon Digital said in a May 2nd operational note that upward revisions in mining difficulty could materially affect its production of Bitcoin for the year.
Miners hold bitcoin
Regardless, according to Glassnode data, most Bitcoin miners have opted to retain coins instead of selling them. The on-chain analytics firm noted that Bitcoin miners have expanded their balance sheet by 8,200 BTC since the selloff observed following FTX’s implosion.
Following a large outflow of #Bitcoin across the FTX implosion, Miners (excluding Patoshi and early unlabelled Miners) have expanded their balance sheet by +8.2K BTC, increasing their holdings to a total of 78.5K BTC. pic.twitter.com/n54ENcTSBC
— glassnode (@glassnode) May 25, 2023
Co-founder of Reflexivity Research, Will Clemente said:
One of the biggest differences between this Bitcoin bear market and the last one is that in 2019 hash rate didn’t reach new highs until BTC ~3xed off its lows while today hash rate has over 2xed its prior May 2021 high while BTC itself is only up 75% off its lows.
Tether to start mining operation
The latest entrant to the mining industry is the largest stablecoin issuer, Tether, which will start a Bitcoin mining operation in Uruguay powered by a sustainable energy mix.
In a press release on Tuesday, the company’s CTO Paolo Ardoino highlighted its “unwavering commitment to renewable energy ensures that every Bitcoin we mine leaves a minimal ecological footprint while upholding the security and integrity of the Bitcoin network.
Bitcoin trades at $26,950 at the time of writing, down 2.6% over a 24 hours period.
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