Bitcoin (BTC) mining difficulty just had its largest drop since 2011 and the second-largest in history of the network.
According to major mining pool BTC.com, mining difficulty, which is the measure that shows how hard it is to compete for mining rewards, has dropped more than nearly 15% estimated yesterday. It fell 16.05% – which is the largest drop it has seen in 9 years – reaching 16.79 T, or the level last seen in July/August.
The last time the mining difficulty fell more than this was October 31, 2011. It went down 18.03% to just 1.2 M. This was actually the largest drop in bitcoin’s history.
This adjustment is particularly relevant if we take into account the recent skyrocketing fees on the Bitcoin network, crowded mempools, dropping hashrate – reportedly due to Chinese miners relocating equipment for the dry season, and consequently numerous users reporting that they had to wait for hours or days for their transactions to be confirmed. Many have been looking towards this difficulty adjustment for some relief.
Feerates are back to Thursday levels, but below Friday’s. The mempool exceeded the default limit again.
— 𝙼𝚞𝚛𝚌𝚑 (@murchandamus)
The hashrate (the computational power of the network) dropped from the average of 142.94 EH/s two weeks ago to 120.12 EH/s following this adjustment. BitInfoCharts.com also shows BTC hashrate dropping sharply: 26.6% to 108.29 EH/s since October 18.
As a reminder, the mining difficulty of Bitcoin is adjusted every two weeks (that is, every 2016 blocks) to maintain the normal 10-minute block time. BitInfoCharts currently shows this average time between blocks to be more than 13 minutes.
Additionally, according to ByteTree, miners are continuing to spend their tokens rather than holding them. Miners typically build their inventory during market weakness and sell into strength.
At the time of writing (8:50 UTC), BTC trades at USD 13,542. It’s unchanged in the last 24 hours and has gone up 2.83% in the last week.
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