Bitcoin (BTC) has been experiencing a more than 40% decrease in its price from $69,044 on Nov 10. 2021, which was its all-time high.
The miner’s difficulty of obtaining Bitcoin from the network has not been affected by the volatile price of BTC. In the last two months for the second time, the BTC difficulty reached a new all-time high (ATH) as the competition among the miners keep growing. After the last July’s drop, the hash rate has also been experiencing a rise of 45%.
The overall computation power determines the difficulty of the Bitcoin (BTC) network, by co-relating its difficulty with confirming transactions and Bitcoin mining.
As the difficulty increases, miners face more competition to confirm the block and obtain the reward. The miners who could not catch up have been forced out of the competition. The dilemma between acquiring profits and securing the network will keep happening until the miners can determine their current operations are feasible.
Following the similar metrics trend of Bitcoin difficulty, hash rate measurements of the network also show new all-time highs (ATHs). For every transaction taking place on-chain, the network is using more hash power, which makes BTC network security at its peak.
In the last few weeks, different ATH hash rates have been noted, since the calculation of such metrics is without any standard agreement. Although different methods were applied, common consent is that the mining difficulty and hash rate have been ascending since the last low in July 2021.
In BTC mining process new transactions are added to Bitcoin (BTC) blockchain. Miners are using proof-of-work (PoW) and competing by solving mathematical problems to validate their transactions.
Miners attempt to solve the Bitcoin block or any specified block and create the estimated number of hashes which is indicated by the Bitcoin hash rate. And that’s how new transactions of blockchain add to the system.
Miners required a higher hash rate for successful mining. The BTC hash rate is measured as hashes per second (H/s).
Both hash and difficulty are large numbers shown in bits, so the profitable operation for miners requires lower hash calculation than difficulty.
Bitcoin difficulty is determined by its demand of miners who are producing the hash below the target hash. Its growth or shrinking depends on how many miners compete on the network.