Bitcoin Mining Difficulty Decreased by 6%

David Kemp

As of now, mining the biggest cryptocurrency remains profitable even using a bit outdated devices. Access to cheap electricity plays the main role.

Decrease in Bitcoin mining difficulty

Bitcoin mining has interested people for a while now. For the last few years, the headlines were full of crazy stories: people mining in the high-security facility, doing it at all sorts of crazy places, people betting their entire estate on mining, quitting their jobs. Some praised it as a new age way to get rich, some argued that it is a hard hit for ecology. The heated discussion around it died down a bit lately.

The bitcoin mining difficulty decreased by 6%. Current notion of BTC mining difficulty is 15,13 Т. Now, some of the users, who decided to leave mining because of its unprofitability after halving, can go back to their farms. BTC.com portal informs that the next time it may result in even bigger decrease, 6,3%.

What is mining difficulty? It is a notion of how hard it is to find a hash below the target. The higher the level, the more demanding it is in terms of computing power. If it requires a lot of computer power to mine a block, the network is well protected against attacks. The more difficult it is to mine, the more secure it is. It adjusts itself every 2016 blocks to ensure the smooth work of the network. It cannot be too overcrowded. The average time between mined blocks should be approximately 10 minutes. If the process slows down, the system corrects itself and the mining difficulty decreases in order to be more attractive for miners.

It is worth noting that, at the start of March, the difficulty updated new historical max on the level of 16,55 T. But the sharp fall in the middle of the month led to the hashrate fall. As a result of 26 March correction, the difficulty experienced a record decrease by 15, 95%.

Along with the bitcoin price restoring and before the halving the indictor began growing and reached 16, 10 T. When the profit for block mining decreased for the third time on 11 May, it lead to the sharp decrease in miners profit (by 44%), hashrate of bitcoin net decreased by 16%.

As it can be seen in the short review of the events that happened recently, the indicator was on a wild ride and experienced high fluctuations.

Possible reason for sharp decrease in profit

Many experts share the same view that the sharp decrease happened because of a bunch of miners trying to get on the last boat before halving and mining more than before. A lot of miners from China decided to make the most of the last days before halving on May 11 and the next 2016 block cycle. For example, this is the opinion of Kevin Zhang (Greenidge Generation). Poolln vice president agrees with him. Alejandro De La Torre said that the reason why so many miners were forced to stop their activities is the halving kicking in.

The company’s analysis states that mining with old equipment will not be profiting, taking into consideration the current price and difficulty. Unless the users have access to cheap electricity. 

Mining details worth considering

Even if mining is not as profitable as it was years ago, when people risked their whole estates on farms, there is still money to be made. The experts commented optimistically on chances of old equipment to survive the mining race. They said that as long as electricity price will be low, people with outdated devices will be able to earn. They account for up to thirty percent of network at the time.

Some regions are more at favor than others. For example, China approaching the wet season may create profitable environment for the digital gold enthusiasts there.

And the drop of users before halving may be seen as advantage to those who are still in the game. The less competition, the better for them.