Bitcoin mining difficulty had decreased during the month of September, which led to a huge increase in bitcoin hashrate. It had reached a new all-time high and saw a high block production per hour. Now, miners are starting to bring only their new and more efficient mining machines. This has led to predictions that mining difficulty is about to see a massive adjustment next week.
A 12% difficulty adjustment.
Bitcoin’s hashrate had hit a new all-time high of 260 exahashes per second as the market opened for a new month. In the same one-week period, miners’ earnings had also increased, resulting in a 10.3% increase at this time. The block production rate had grown by 8.4% to a new 6.45 blocks per hour. A good week for bitcoin miners, but as has been the case so far in 2022, this is not expected to last.
Forecasts coming out of the industry say that bitcoin mining difficulty is expected to adjust by 12% next week. If this happens, it will be the highest difficulty adjustment yet for 2022, but a number of factors make this possible.
BTC falls below $20,000 | Source: BTCUSD on TradingView.com
For bitcoin’s hashrate to reach its new all-time high, it had grown by 11% in the space of a week. A result of the same factors expected to contribute to the expected increase in difficulty. Bitcoin miners have been expanding their infrastructure at a rapid pace, most of which were launched during the bull run of 2021. These new infrastructures also come with new and improved miners that are proven to be more efficient
Also, temperatures around the world are starting to drop, which means more energy is available for miners to go about their business. All of this is expected to contribute to a fairly significant difficulty adjustment next week.
Bitcoin miners should prepare themselves
Bitcoin miners’ profit margins have suffered terribly in the bear market. With the price of BTC so close to production values, miners have struggled to make a profit from their operations and the expected mining difficulty adjustment further threatens their margins.
Competition continues to grow in the space, so even though miners’ income increased last week, it doesn’t translate into profits for those miners. Glassnode estimates that miners spend $18,300 to mine a single BTC. At a price below $20,000, miners barely see a $1,000 profit margin for every BTC mined.
However, miners continue to expand their production capacity by purchasing new equipment and commissioning new locations. Public bitcoin miner Marathon Digital mined 100% more BTC in September than in August. The miner’s numbers reached 360 BTC mined during the month, bringing his total BTC holdings to 10,670 BTC ($215 million).
Featured image from Yahoo Finance, chart from TradingView.com
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