#Bitcoin #BRC20
Bitcoin's mining difficulty level soared by 3.4% on Thursday, reaching an unprecedented all-time high. This surge coincided with a record-breaking increase in the network's hashrate. The mining difficulty adjusts approximately every two weeks, measuring the level of effort required for miners to verify transactions on a block. A higher difficulty reading indicates increased competitiveness in Bitcoin mining, potentially reducing profitability for miners.
According to data from BTC.com, the mining difficulty reading stood at 51.23 trillion at block height 792,288 during Thursday's adjustment. This follows a 3.22% rise in the previous adjustment on May 18.
The difficulty of mining Bitcoin tends to rise as more miners join the network, leading to heightened competition. Miners are rewarded with Bitcoin for validating transactions, and the difficulty level directly impacts a miner's chance of securing an entire block on the chain. Therefore, profitability for miners is closely tied to the difficulty level.
Mining difficulty adjustments are closely correlated with changes in hashrate, which represents the computing power utilized for mining. According to data from Blockchain.com, Bitcoin's hashrate reached around 375 exahashes per second on Wednesday, surpassing the 365.1 exahashes recorded during the previous adjustment on May 18.
At the time of writing, Bitcoin was trading at approximately US$27,068, reflecting a 3.6% increase over the past seven days, according to CoinMarketCap. This price surge accompanied the rising hashrate, indicating the continued interest and investment in Bitcoin mining despite the increasing difficulty level.
In related news, several Bitcoin mining-related stocks in the U.S. experienced gains this week. This positive market sentiment was fueled by Republican congressman Warren Davidson's announcement that the proposed tax on electricity use by cryptocurrency miners in the country had been scrapped. This decision emerged during ongoing debt ceiling negotiations between the White House and House Republicans.
Marathon Digital Holdings, a cryptocurrency mining company listed on Nasdaq, witnessed a 9.6% climb in its shares since Friday's closing, translating to a remarkable 187.9% rise for the year. Similarly, shares of Bitcoin miner Riot Platforms surged by 9.9% since Friday, representing an impressive 256% increase since the beginning of this year.
The surging mining difficulty, along with the growing hashrate and positive market response, underscores the resilience and evolving dynamics of the Bitcoin mining ecosystem. As the industry continues to adapt and face new challenges, the strong performance of mining-related stocks indicates investor confidence in the future prospects of the cryptocurrency mining sector.
