The Bitcoin mining difficulty has been skewing upward for the better part of a year now and it seems there is no end in sight for this metric yet. The latest difficulty adjustment for Bitcoin mining has brought it to a brand new all-time high (ATH). But even more interesting is the fact that the mining difficulty is expected to jump double-digits again in the coming weeks.
Bitcoin Mining Difficulty Hits New ATH
With more mining machines being brought online, it is no surprise that the Bitcoin mining difficulty is on the rise. The most recent difficulty adjustment which took place on Tuesday, August 22, is a testament to this. This time around, the difficulty rose another 6.17% compared to the previous week, resulting in a new all-time high in this metric.
According to data from the mining tracker CoinWarz, the Bitcoin difficulty jumped to 55.62 T, the highest ever. The website notes that not only does this translate to a 6.17% increase on the weekly chart, but it also represents a 30-day increase of 3.17% and a 90-day increase of 12.25%. While in the last day alone, the mining difficulty is up 2.55%.Mining difficulty hits new all-time high | Source: CoinWarz
The adjustment in the Bitcoin mining difficulty is important to keep stabilizing block generation. This way, no matter how many mining rigs are being brought online, the network continues to produce blocks at a near-consistent rate by making them harder to find.
Interestingly, the mining difficulty is expected to continue to rise despite the already impressive jump. CoinWarz estimates that the next difficulty adjustment, expected to take place on Monday, September 4, will see difficulty rise another 13.42%. If this happens, then the mining difficulty is gearing up for a new all-time high of 63.09T.
Will The Rise In Difficulty Trigger A BTC Rally?
While the rise in the Bitcoin mining difficulty is a positive for the network, the chances that it translates to a BTC price rally are not high. This is because, as mentioned above, the mining difficulty helps to keep the number of blocks mined stable as mining activities grow.
In this instance, the mining difficulty speaks to the security of the Bitcoin network presently. It means that transactions are safer than ever, and Coinwarz points out that the network is currently 1.18 minutes faster than expected.
However, the metric is not completely ruled out when it comes to price action, because although it may not trigger it, it can certainly be a supporting factor. Keeping the number of blocks mined every 10 minutes stable means regulating the amount of BTC being brought into circulation, ensuring that there isn’t so much supply that it would overwhelm demand.
For now, Bitcoin is still reeling from its price crash last week. Bulls are currently hard-pressed to establish formidable support at $26,000 which could serve as a bounce-off point for a recovery.BTC price declines to $25,847 | Source: BTCUSD on Tradingview.com Follow Best Owie on Twitter for market insights, updates, and the occasional funny tweet… Featured image from Unsplash, chart from TradingView.com