Bitcoin’s mining ecosystem has reached unprecedented levels in terms of difficulty as hashrate reached new highs along with the price.
On Dec. 16, mining difficulty surged by 4.43% to an all-time high of 108.52 trillion at block height 874,944. This marks the sixth consecutive upward increase in mining difficulty and the 26th adjustment this year.
The total mining difficulty has risen by 40% this year alone, according to Cloverpool data.
The hashrate, which measures the total computational power securing the network, is also on an uptrend. Over the past month, the network’s mean hashrate had consistently surpassed 800 exahashes per second (EH/s) but was at 707 EH/s as of Dec. 15, according to CryptoQuant data.
A higher hashrate bolsters the network’s security but increases the complexity of mining. As a result, miners must now invest in advanced, energy-efficient technology to remain viable in this increasingly demanding landscape.
Unsurprisingly, miners have liquidated portions of their Bitcoin holdings to meet rising operational costs. According to crypto analyst JA Maarturn, on-chain data reveals that Bitcoin miner reserves have dropped by 4.74% over the past year, declining from 1.99 million BTC to 1.9 million.
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