Bitcoin mining difficulty dropped for second time in a month

The CEO of Compass Mining attributes this trend to the rising cost of electricity

18.03.2022 - 09:35

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What’s new? The difficulty of bitcoin mining fell for the second time in a month, as of March 18, it is equal to 27,521t, according to blockchain.com. On March 3, the difficulty dropped 1,5% from a record high of 27,967t in February.

Source: Blockchain.com

Why is the mining difficulty decreasing? The difficulty of mining a block is automatically adjusted every fortnight depending on the computing power of the network, the hashrate. If there are fewer miners on the network, the hashrate declines, and the difficulty decreases. This is necessary to maintain a period of 10 minutes for mining a new block.

What is the reason for the decrease in hashrate and difficulty? Compass Mining CEO Whitt Gibbs attributes this trend to high electricity tariffs. The electricity prices are rising all over the world. This is due to the fact that the world’s largest fossil fuel exporter, Russia, has come under sanctions because of the military operation in Ukraine, Gibbs believes. He said:

“This slight drop is likely due to unprofitable miners unplugging ASICs. As energy prices increase globally, we will likely see more ASICs fall off the network.”

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