Mark G As Bitcoin (BTC) mining difficulty and castrate are reaching new all-time highs, the Cryptoverse is discussing this is behind it, and it appears unlikely that the miners are capitulating before the Bitcoin mining reward halving in May.
While reported in October 2019, miners will attempt to improve their mining activity, to obtain a greater share of the castrate before the halving. And it seems that Bitcoin miners are growing according to this scenario.
Bitcoin mining difficulty, which is a measure of how hard it is to compete for mining benefits, is expected to hit yet another record in just a matter of hours. The network difficulty presently stands at 14.99T, which has already been the highest it’s ever been. Main Bitcoin mining pool BTC.com estimates that during the next difficulty adjustment, likely to happen later today, it’ll boost by 8.64%, reaching another all-time high with 15T, and making validating new blocks even harder.
The last difficulty adjustment fourteen days ago brought a change of over 6.5%, which isn’t a surprising number to see. As a matter of known fact, the difficulty dropped only seven times in 2019, generally by a small %, except in November when it fell 7.10%. The difficulty, therefore, usually rises, and we’ve seen it grow by as high as 14%.
BTC price also dropped earlier this November at that time difficulty did. Furthermore, when compared to the time of the crypto winter season and BTC dropping to the USD 3,000 level in December 2018, the difficulty we will probably see after the following adjustment will be 3X higher than that.
In the meantime, castrate or the computational power of the Bitcoin network, also, has been rising. As a reminder, that is relevant as a higher hash rate suggests a more secure system, with an increase of miners competing for the block reward, commonly leading to higher mining difficulty. It has additionally hit an all-time high, and the average hash rate currently can be 98.67 EH/s. For comparison, at the start of 2019, it had been 42.10 EH/s, while in December 2018, it went only 36.55 EH/s.
It’s been consistently increasing throughout this past year, and it corresponds with the rise in BTC price. In January 2019, the purchase price was c. USD 3,500, while we’ve noticed it go over USD 10,000 many times this year, approaching USD 14,000. At pixel time (9:20 UTC), BTC trades at c. USD 8,522. It went up almost 5% in the past 24 hours, 8% during the past week, 19% in a month, and 138% in a calendar year.
There has been a whole lot of talks about miners possibly closing shop with the halving approaching, the difficulty increases, the block reward declining, and the price for generating blocks rising. The market speculated in late November that miners could capitulate. Still, we haven’t seen an indicator of this yet, and the numbers usually do not seem to indicate it was happening (again).
"For the most rewarding miners, I possibly could certainly see them acquiring their excess revenue and holding bitcoin if indeed they expected the price to keep rising," Medio Demarco, the Principal at Delphi Digital, a cryptocurrency analysis company, previously told. "Much less profitable miners are going to be forced to either update their operations to become more competitive or leave (that is always the case though)."The halving anticipation itself could quite possibly influence these recent increases, along with the rise in the price of the world’s most popular coin. However, there are many ongoing debates about if the halving has already been priced in, or if the rising price is a self-fulfilling prophecy.
That said, the Cryptoverse appears to be excited for this approaching difficulty adjustment, with popular anonymous investor and Twitter user PlanB, calling it “epic.”
People were also discussing the result of new mining equipment coming in, which is usually speaking better suited for the job and could handle the rise in difficulty better.
