Bitcoin Mining Difficulty Hits Record High of 53.91T

• Reduced selling pressure from miners may occur if smaller operators exit the market.
• Experts suggest that the lack of miner accumulation has constrained the potential for a BTC price rise.

Following the latest difficulty adjustment on July 12, Bitcoin mining reached a record high of 53.91 trillion units. This metric serves to gauge the complexity of mining Bitcoin. The blockchain modifies the difficulty every two weeks to maintain an average transaction time of 10 minutes. As the network’s processing power increases, mining becomes more challenging, thereby diminishing the earnings of individual miners.

Miners, who have been compelled to liquidate their mined Bitcoin (BTC) holdings since June, may experience heightened pressure due to the recent adjustment. Some analysts have suggested that the lack of miner accumulation has restricted the potential for a BTC price increase.

No Longer Turning a Profit

In light of the recent rise in difficulty, medium and small-scale miners may need to temporarily deactivate some of their ASIC equipment due to decreased profitability. If smaller miners exit the market, there could be diminished selling pressure, allowing larger miners to acquire more Bitcoin.

Independent analyst Charles Edwards created the hash ribbon indicator to track the 30- and 60-day moving averages (MAs) of the network’s hash rate. A situation where the 30-day MA falls below the 60-day MA suggests that miners might be exiting the market as they can no longer sustain profitability.

The two lines are nearing a point of intersection, and the heightened difficulty could be the catalyst for weaker miners to withdraw. Should less efficient miners leave the market, the remaining miners would benefit from increased rewards, enabling them to retain a portion of their production instead of selling it.

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