Bitcoin Mining Difficulty Adjustment May Force Miners To Dump Their BTC


Last week, the Bitcoin hash rate touched a new all-time high after massive growth. While this was a welcome development, it had major implications for the next mining difficulty adjustment that took place on Monday. As expected, the difficulty mod jumped by double digits, surpassing even the highest expectations.

Difficulty adjustment by 13.5%

Over the past week, expectations for Bitcoin mining difficulty adjustment have been at an all-time high

9-12%. These ranged from conservative to worst-case scenario, but in both cases the network will see the highest difficulty adjustment so far for 2022. However, even these predictions did not do justice to the actual adjustment.

On Monday, mining difficulty (the number of hashes needed to mine a BTC block) jumped from 31.36 tons to 35.61 tons, an increase of 13.5%. This higher difficulty adjustment is in line with the increasing mining power as more and more bitcoin miners are bringing their machines online.

Bitcoin mining difficulty adjustment

Mining difficulty adjusts by 13.5% | Source: Coinwarz

Interestingly, the difficulty of bitcoin mining is not expected to decline any time soon. The next difficulty adjustment will be on Sunday, October 23, 2022, with a further increase of 11.3% expected. In the next three months, mining difficulty is expected to increase by 22.5%.

As for the Bitcoin hash rate, it has seen some decline since it reached an all-time high of 321 EH/s. It is currently sitting at 291.4 EH/s at the time of writing, which is a high number for 2022.

Will bitcoin miners get rid of bitcoins?

The higher difficulty adjustment will undoubtedly affect the earnings of the bitcoin miner during this time. This means that they will have to send more computing power and more energy to mine a block, which affects their bottom line. Add to that the fact that the price of Bitcoin is struggling to maintain above $19,000, and miners are sitting in a tight spot.

Bitcoin price chart from TradingView.com

BTC settles above $19,000 | Source: BTCUSD on TradingView.com

Since the beginning of the year, there have been times when some bitcoin miners have had to divest their bitcoin holdings to fund their operations, and this adjustment could lead to another selling trend among them. Since it costs them just over $18,000 to mine a single BTC, the Bitcoin dance below $19,000 brings them dangerously close to recording losses on their miners, which could lead to a selloff.

The bitcoin miner is currently earning $17.16 million per day. With 6.25 BTC mined in an average of 10 minutes, miners generate a total of 900 BTC every day.

Featured image from Bloomberg, chart from TradingView.com

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