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Mining difficulties rose 3.9% Wednesday evening to hit a new all-time high in the final adjustment ahead of the halving, scheduled for April 20.
The difficulty adjustment occurred at block height 838,656, reaching a record high of 86.39 trillion, according to the blockchain explorer. Memory pool. Bitcoin miners appear to be increasing their hash rate in anticipation of the block grant dropping from 6.25 BTC to 3.125 BTC next week.
Bitcoin mining difficulty measures the difficulty of mining a new block relative to the simplest possible. It adjusts every 2016 block – approximately every two weeks – to ensure that on average, a new block is found every 10 minutes, regardless of how many miners are actively mining. The higher the difficulty, the more computing power and energy a miner needs to find the correct hash for the next block.
Bitcoin mining difficulty. Picture: Memory pool.
Bitcoin miners increase hash rate ahead of halving
Bitcoin’s hash rate, which measures the total computing power dedicated to the network by miners, hit a new all-time high at a seven-day moving average of 629.75 EH/s ahead of Wednesday’s difficulty adjustment, according to The Block’s data dashboard.
Bitcoin mining difficulty and hash rate have been trending upward since the start of the year, with difficulty increasing by 20% and the total hash rate gaining 24% over the period. However, even though miner revenues have also increased this year amid the rising bitcoin price, it remains to be seen how much of an impact the halving will have on less efficient mining operations and therefore , on the overall parameters of the network following the reduction in subsidies.
Bitcoin hash price fell to $0.11/TH/s after the difficulty adjustment and should be halved immediately after the halving. Hash price is a term coined by Bitcoin mining services company Luxor, referring to the expected value of 1 TH/s of hashing power per day. The metric quantifies how much a miner can expect to earn with a specific amount of hash rate.
Bitcoin countdown halved
Bitcoin’s next halving event is currently estimated to occur around 4 a.m. UTC (12 p.m. ET) on April 20, according to The Block’s Bitcoin Halving Countdown page – based on average block generation time of Bitcoin by 10 minutes.
Bitcoin halvings are scheduled to occur automatically every 210,000 blocks, or approximately every four years. Once a halving event occurs, miners receive 50% fewer bitcoins as a subsidy for each block of transactions they mine and add to the blockchain. However, they continue to earn additional transaction fee rewards for each block mined as usual.
There have been three halving events in Bitcoin’s history, reducing its block grant inflation from 50 BTC to 25 BTC in 2012, then to 12.5 BTC in 2016 and 6.25 BTC during the last halving on May 11, 2020. In the long term, there will only ever be 21 million bitcoins in existence.
Halving events will continue until the last bitcoin is mined around 2140. After that, miners will only earn transaction fees.
Historically, Bitcoin halvings have been associated with significant fluctuations in the price of the cryptocurrency. Although not a direct cause-and-effect relationship, these events often preceded large rallies in the Bitcoin market.
Bitcoin is currently trading at $70,647, up 67% year to date, according to The Block’s price page.
BTC/USD price chart. Image: Le bloc/TradingView.
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