As Bitcoin prices have made headlines with all-time highs set nearly every day, there’s another key metric that has now hit an all-time high: mining difficulty. It is expected that this development has been made due to the recent surge in Bitcoin price, which has led Bitcoin miners to mine at a higher scale than ever before. This has made mining operations more profitable than ever, incentivizing people to join the industry and thus making it more difficult to earn rewards.
A similar sign emerged in 2017 during the bull run that year for Bitcoin. If this time is anything like the last, it is expected that the surge in mining difficulty and revenue is expected to continue well into the year, with many experts projecting it to continue until at least July.
The change in Bitcoin mining difficulty coincides with an adjustment in the algorithm that controls how difficult it is to mine Bitcoin. As this algorithm becomes more difficult, Bitcoin becomes more sparse and therefore could lead to more price increases in the near future. A clear signal of the increased demand in the Bitcoin mining market is the fact that ASIC and other manufacturers of equipment that is commonly used for Bitcoin mining have had to turn down orders in recent months, leading to a shortage in Bitcoin mining equipment.
The mining difficulty for Bitcoin is expected to continue to arise as Bitcoin once again enters a bullish price cycle.
