Bitcoin's Difficulty on Track for Historic Drop, but There Is Silver Lining

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Sat, 03/21/2020 - 08:21
Alex Dovbnya
Bitcoin's difficulty is set to nose-dive after miners got backed into a corner
Cover image via stock.adobe.com
Contents

CoinMetrics analyst Nic Carter has estimated that Bitcoin's mining difficulty could plunge by a staggering 15 percent during its next adjustment. This could be the third-biggest drop in Bitcoin's entire history. 

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Bitcoin Mining Breaks Even at $8,000, Why Rising Hash Rate is a Positive Indicator of Price

Bitcoin's difficulty is set to plunge 

As reported by U.Today, Bitcoin's mining difficulty hit an all-time high of 16.55 trillion on March 10. Its adjustments occur every 2016 blocks to reflect market conditions. 

After the historic 38 price drop on March 12, many miners were forced to shut down their rigs that are no longer profitable, but the expected difficulty decline will allow them to get back to business. 

It is worth noting that Bitcoin's hash rate also plunged to 82 TH/s due to miner capitulation, Blockchain data shows.     

Related
98 Percent of Bitcoin (BTC) Mining Rigs to Become Obsolete

Is this bullish for Bitcoin? 

Carter also noted that every major negative difficulty adjustment would 'anecdotally' mark the bottom of each price correction. Hence, there is a good reason to believe that BTC could be ready to resume its uptrend. 

This goes in line with the recent hash ribbon crossover that tends to be one of the most reliable buy signals.  

 

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About the author

Alex Dovbnya (aka AlexMorris) is a cryptocurrency expert, trader and journalist with extensive experience of covering everything related to the burgeoning industry — from price analysis to Blockchain disruption. Alex authored more than 1,000 stories for U.Today, CryptoComes and other fintech media outlets. He’s particularly interested in regulatory trends around the globe that are shaping the future of digital assets, can be contacted at alex.dovbnya@u.today.

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