Bitcoin Mining’s All-Time High Sends Its Hash Price Down

Key Facts:

  • The new Bitcoin mining difficulty is 3% higher than the previous mark.

  • hashprice fell back below 0.067 USD/TH/day.

In the last difficulty adjustment of the Bitcoin network, the ability to increase or decrease as transaction confirmation times changed, experienced a new record. This adjustment could affect miners’ perception of their profitability.

Looking at the numbers, Bitcoin’s mining difficulty increased to 36.83 trillion (T) yesterday. According to CriptoNoticias, this is 3.44% higher than the previous record, which was an increase of more than 13%. The Bitcoin hash rate has remained at an average of 260 EH/s.

Does the increase mean it will be harder to mine Bitcoin before the next difficulty adjustment in about two weeks? Inaccurate because the function is programmed to regulate coin emissions, not block activity. That is, 6.25 BTC of emissions are maintained approximately every ten minutes.

Bitcoin’s current hash rate makes it possible to face these new difficulty levels. In fact, if one takes into account that the total computing power of the network (its hash rate) reached the mark of about 270 EH/s between October 12th and 16th, it can be estimated that there will be a new increase in the difficulty setting.

The difficulty setting is closely related to miner participation. This trend should be confirmed if more nodes connect to the network (the computers that confirm and store Bitcoin transactions), as has happened since mid-July this year.

Chart showing Bitcoin mining difficulty increasing as price and hash rate adjust

Bitcoin’s hashrate and difficulty have increased since mid-July. Source: Brain.Impact on Bitcoin Mining Profitability

In the graph above, you can see that the price of 1 BTC has remained at an average of $20,000 as competition among miners for Bitcoin rewards intensifies (through the hash power they contribute to the network).

This pressure from miners seeking to mine bitcoin rewards is pushing other metrics to all-time lows.

One of them is hash price or hash price. According to Glassnode, Bitcoin’s hash rate hit $0.0665/day/day. This metric is a value that measures how much Bitcoin miners earn based on the hash rate they contribute to the network.

Chart Shows Bitcoin Hash Price Dropping Due to Increased Mining Difficulty Settings

From this chart, hashprice fell to the 0.0668 USD/TH/day mark (on October 13, hashprice fell to 0.0663 according to this indicator). Source: Hashrate Index.

In other words, hashprice is the value assigned to the computational unit. It is calculated based on U.S. dollars (USD), in this case, based on each terahash that miners invest in the network in a day.

This hashprice value does not represent the exact profit of the miner, but an estimate or expectation of his profit. Precisely, the actual benefit depends on other factors, such as electricity prices.

To get an idea of ​​the magnitude of this drop in profitability, we can compare hashrate levels or miner engagement in October 2021 and October 2022. The price of Bitcoin at the time was $10,000 and its hashrate was 150 EH/sec. However, the hash price is $0.30/day/day, more than triple what it is now.

hashprice allows Bitcoin miners to get a rough idea of ​​profitability. According to Glassnode, “relative to the applied hash power, BTC miners receive the smallest rewards in history, which could put the industry under extreme revenue pressure.”

Bitcoin miners have been facing low profitability of this activity through different strategies, which include reinvesting profits in improving operational capacity or saving while waiting for the market to change.

Source of information: Compiled from CRIPTONOTICIAS by 0x information.The copyright belongs to the author Jesús González and may not be reproduced without permission

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