Key Insights
- Bitcoin mining difficulty hits record high of $80 trillion as prices revive
- Metrics show rising complexity and computing power needed to produce coins
- Upcoming “halving” set to cut mining rewards, sparking potential miner shakeout
SINGAPORE (MarketsXplora) – Key metrics showing the rising complexity and computing power needed to produce new bitcoins hit all-time highs this week, testing miners’ mettle as the cryptocurrency’s prices stage a new rally.
Bitcoin’s mining difficulty – representing the complexity involved in solving math problems to generate blocks and receive coin rewards – crossed $80 trillion on Friday after more than doubling over the past 12 months, data from tracker BTC.com showed.
The mining hash rate, indicating the total computational power used by miners globally, simultaneously hit fresh records above 562 exahashes per second as per the figures.
Industry players have invested heavily in more powerful machines to capitalize on bitcoin’s price resurgence this year. Bitcoin bounced back above $51,500 by Friday, its highest since November 2021.
But they now face being tested by bitcoin’s next “halving” event, expected in April, which will cut the reward for mining a block to 3.125 BTC from 6.25 BTC.
Previous halvings have rendered inefficient miners unable to sustain profitable operations, forcing them to go offline and causing the hash rate to drop – thereby decreasing difficulty until the most competitive miners bring it back up.
Market experts predict the upcoming halving could spark a more dramatic shake-out if crypto prices were to retreat significantly, ending the operational life for many miners.
Regardless, for now, participants continue investing in greater scale and efficiency, evidenced by hash rate’s near-triple growth since just January as difficulty marches steadily upward.