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Bitcoin Mining Difficulty Rises 2.18% to Record amid Increasing Competition Among Miners

Bitcoin’s mining difficulty reached an unprecedented level, surging by 2.18% on Wednesday. This parameter, which changes every two weeks, gauges the additional computational power miners require to verify transactions within a block. A higher difficulty signifies intensified competition in Bitcoin mining, reducing miners’ profitability. Remarkably, the network’s hashrate also reached a record high.

During Wednesday’s adjustment, the mining difficulty reading reached 52.35 trillion at block height 794,304. This followed a previous increase of 3.4% on June 1, as indicated by data from BTC.com.

The escalating difficulty of mining Bitcoin commonly occurs when more miners actively participate, intensifying the competition for Bitcoin rewards granted in exchange for validating network transactions. Consequently, miners face a diminished probability of securing an entire block on the chain, affecting their profitability.

Mining difficulty adjustments align with changes in the hash rate, a measure of the computing power employed for mining activities. Andrew Webber, the chief of Digital Power Optimization, an organization collaborating with power producers to establish Bitcoin mining operations, explained that difficulty closely follows the hashrate’s fluctuations. He further emphasized that the overall profitability of constructing and operating Bitcoin data centers strongly influences the hash rate. An upswing in Bitcoin’s spot price yields larger profits for miners.

According to data from Blockchain.com, Bitcoin’s hash rate stood at approximately 392.6 exahashes per second on Wednesday, marking an increase from the 375.4 exahashes recorded during the previous adjustment on June 1.

Although Bitcoin experienced a 3.63% decline in the past 24 hours, settling at US$25,045 by 11:10 a.m. in Hong Kong, it still boasts a remarkable year-to-date growth of around 51%, as reported by CoinMarketCap. However, the world’s leading cryptocurrency suffered a 5.01% decrease in value over the past seven days.

Bitcoin’s mining difficulty surged to an all-time high, indicating heightened competitiveness in mining activities and reduced profitability for miners. The hash rate, which reflects the computational power employed, also attained a record level. These developments correlate with changes in mining difficulty, while the overall profitability of Bitcoin data centers strongly influences the hash rate. Despite recent fluctuations, Bitcoin has demonstrated significant growth throughout the year.

 

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