Bitcoin Mining Difficulty Reaches All-Time High After Record Hashrate Surge

12 Sept

On September 11, 2024, Bitcoin's mining difficulty hit a new all-time high, reflecting an ongoing increase in competition for block rewards. The network's difficulty level, which adjusts every 2016 blocks to reflect changes in mining activity, rose by 3.58% to 92.7 trillion. This surpassed the previous record of 90.67 trillion, set on July 31, 2024.

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The adjustment comes on the heels of a surge in Bitcoin's hashrate, which represents the total computational power dedicated to mining on the network. Earlier this week, the hashrate briefly touched a record high of 700 exahashes per second (EH/s), underscoring the fierce competition among miners despite a continued drop in profitability, as reflected in hashprice data.

Despite the record hashrate, Bitcoin's hashprice, a measure of mining revenue per unit of computational power (measured in petahashes per second), has again fallen below $39/PH/s, according to data from the Hashrate Index. While this figure remains above the all-time low of $35.7/PH/s, it highlights the increasing difficulty miners face in maintaining profitability.

Post-Halving Industry Consolidation

This latest difficulty increase marks the third time Bitcoin has set a new difficulty record in the five months following its most recent halving, which took place in April 2024. The halving reduced the block reward from 6.25 to 3.125 BTC, putting additional financial pressure on miners. Despite this, the rising hashrate and difficulty suggest that the mining industry is consolidating, with larger or more efficient miners dominating the network.

For context, Bitcoin’s mining difficulty dropped to 79.50 trillion in early July, an 8% decrease from pre-halving levels. By comparison, after the 2020 halving, the difficulty saw a sharper 14.7% decline. However, this year’s increase suggests that despite lower rewards and declining hashprice, mining operations are continuing to expand or improve their efficiency.

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