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With new miners entering the crypto space and old ones ramping up their operations, Bitcoin mining difficulty has gone past an all-time high. On Monday, the BTC mining difficulty spiked by 13% and has gone above the previous high of 35.61 trillion hashes.
Bitcoin difficulty is a feature that is adjusted by the blockchain automatically. Its protocol determines how easily miners can mine a Bitcoin block to complete a transaction. The protocol exists within the Bitcoin blockchain to ensure that every block is mined at a steady pace of 10 minutes.
The difficulty for Bitcoin block mining changes with every 2016th block mined. Nowadays, it roughly takes BTC two weeks to mine 2016 blocks. The latest change caused a 13% spike, which is the biggest rise in difficulty we have seen since the middle of 2021.
When the difficulty increases, it becomes harder for the miners to solve cryptographic puzzles to validate transactions. Miners use special hardware chips for this purpose known as ASICs, aka Application Specific Integrated Circuits. The hardware is also getting more expensive with the passage of time.
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Hash rate Also Reaches an All-time High
Hash rate is another important metric that is used to measure mining difficulty. The amount of computing that is assigned to a blockchain for earning block rewards through validation is known as the hash rate. The hash rate of BTC has gone to an all-time high of 257 hashes per second, which has also made mining difficult.
Why is the Mining Difficulty Rising?
Analysts are crediting a number of factors for this increase in mining difficulty. Bigger infrastructures are now coming online, which means that we now have more capacity to mine Bitcoins. Lesser heatwaves are improving downtime, and mining facilities are becoming more efficient. The hardware is also being improved, and miners now have better equipment. All these factors are speeding up the process and creating more competition in the mining community
With difficulty rising, miners will have to put in more effort to generate new blocks. It will significantly affect their profitability, and they will also have to use more resources to mine the same number of blocks they were mining before the increase in difficulty.
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