Bitcoin’s mining difficulty has seen its biggest decline since 2011. According to Glassnode’s data, Bitcoin’s mining difficulty has dropped by about 16% , which is the biggest negative adjustment since the launch of ASIC.
Bitcoin mining difficulty hits record high
In short, the difficulty of Bitcoin mining is a self-adjusting measure designed to maintain a balanced block production. The Bitcoin network should normally generate a block every 10 minutes, but the hash rate sometimes affects the average.
Therefore, Bitcoin adjusts the complexity of mining calculations every two weeks (or every 2016 blocks). If the network takes more than 14 days to produce 2016 blocks, the mining difficulty will be adjusted downwards, on the contrary, if it takes less time, the difficulty will increase.
According to BTC.com data, on Tuesday, the mining difficulty of Bitcoin dropped from 19 trillion to about 16 trillion , with an adjustment range of -16%, which is the second highest negative adjustment in Bitcoin history.
The last time there was a major difficulty adjustment dates back to October 2011, 9 years ago, when it was reduced by about -18%.
The decline in mining difficulty coincided with the migration of some miners in Sichuan. With the end of the rainy season in the area, miners shut down some machines that did not produce value. It can be considered that such a huge negative adjustment means a lack of confidence in the Bitcoin network or a relatively low current price. On the contrary, it also indicates that a good time is coming .
What does it mean that the difficulty of Bitcoin mining has dropped sharply?
In recent months, as the price of Bitcoin has risen sharply, the hashing power required to produce new Bitcoins has now fallen sharply, and the profitability of miners will increase significantly. In other words, between now and the next adjustment on November 15, 2020 , mining will be extremely profitable even for inefficient miners .
For Bitcoin users, negative adjustment means reduced transaction fees and reduced transaction time . It is worth noting that in the past few months, Bitcoin’s transaction fees have risen simultaneously with asset prices. When the number of miners available to process transactions is not enough to complete all the transactions that users want to process, Bitcoin transfer fees will soar. Data compiled by BitInfoCharts shows that the current average transaction fee is more than $12, which is relatively expensive.
However, by reducing the difficulty, more miners may seize the opportunity, thereby clearing the backlog in the Bitcoin memory pool and reducing high fees.
At the same time, the price of Bitcoin does not seem to be affected by the large-scale negative adjustment of mining difficulty. In the past 24 hours, the current transaction price of Bitcoin has basically remained unchanged, at $13,794.30.
The original text comes from zycrypto, compiled by Blockchain Knight, the English copyright belongs to the original author, please contact the compiler for Chinese reprint.
