Bitcoin Mining Reaches Record Difficulty Levels as Miners Chase Profit in 2023
Bitcoin mining has become more challenging, as its mining difficulty is anticipated to surpass 40 trillion this weekend.
This metric denotes the number of iterations miners have to carry out to get the hash of a Bitcoin block.
A higher number implies that solving a block is more difficult, resulting in lower mining profitability. The mining difficulty is updated every two weeks and rises when more miners join the Bitcoin network.
As per on-chain data, mining difficulty is likely to increase by 10%, from 39.16 trillion to 43.2 trillion, which will reduce BTC production for miners over the next 12 days.
Mining difficulty has risen steadily in the past few months, primarily due to Bitcoin’s resurgence. In January 2023, the Bitcoin network reached an all-time high of 39.35 trillion, which then fell by 0.49%.
However, the difficulty has remained around 39 trillion. The hash rate also surged and reached a new all-time high on February 16, 2023.
The bear market in 2022 led to losses for many miners on the network, forcing some to diversify or stop mining and sell their equipment, leading to low mining difficulty and hash rate. But in 2023, Bitcoin’s market price increased by over 40%, which attracted miners looking to benefit from the trend.
READ MORE: Bitcoin: Analyst Shares His 2023 Scenario for the Cryptocurrency
Additionally, the rise of Ordinal non-fungible tokens (NFTs) on the Bitcoin network has increased activities, as these transactions incur larger fees, making them more attractive to miners.
Despite concerns about congestion and high transaction fees caused by Ordinal NFTs, miners have generated over $800,000 in fees from these tokens in less than a month, leading to increased mining difficulty.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
