BITCOIN MINING DIFFICULTY TOPS 80 TRILLION AHEAD OF HALVING 

The Bitcoin mining difficulty, an indicator of the challenge involved in solving a block’s mathematical problem, exceeded 80 trillion on February 16th. This milestone coincided with the network’s hash rate reaching 562.81 exahashes per second (EH/s), with the mining difficulty setting a new record at 81.73 trillion, as reported by BTC.com. Since January 2023, Bitcoin’s mining difficulty has been on a steady upward trajectory, expected to surpass 100 trillion in the coming months.

In Bitcoin’s proof-of-work system, mining difficulty reflects the level of difficulty in adding a new block to the blockchain. A higher difficulty necessitates more computational power and energy from miners to find the correct hash. Over the past year, Bitcoin’s difficulty level has more than doubled.

During its automated readjustment on February 15th, Bitcoin’s mining difficulty was projected to increase by approximately 6%, according to data from BTC.com. If realized, this adjustment would mark new all-time highs, pushing the difficulty beyond 80 trillion for the first time.

Despite this, Bitcoin remained stable around $52,000 as of February 16th, with US macro data exceeding expectations. The upcoming ‘Bitcoin Halving’ in late April will see mining rewards halved, a programmed event intended to combat inflation. This reduction occurs approximately every four years, with the last halving taking place in May 2020.

The upcoming halving will reduce Bitcoin’s mining rewards from 6.25 BTC to 3.125 BTC, potentially leading less efficient miners to struggle with covering costs and exiting the market. Consequently, a decrease in hash rate is anticipated, prompting a corresponding decline in Bitcoin mining difficulty as the network seeks to maintain a consistent block production rate of approximately 10 minutes.

Galaxy’s mining analysts suggest that up to 20% of Bitcoin’s current hash rate could go offline post-halving, as block rewards are halved, leaving only the most efficient mining rigs operational.

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