Recent blockchain data indicates that Bitcoin’s Hashrate is increasing again after a recent decrease in Difficulty.

Bitcoin Miners Are Expanding Again

On May 3rd, the Bitcoin network underwent its latest Difficulty adjustment, which eased conditions for miners, breaking a series of four consecutive increases. The “Difficulty” is a mechanism within the BTC blockchain that regulates how challenging it is for miners to add new blocks. This metric fluctuates based on how quickly miners are able to complete their tasks.

Automatic adjustments to Difficulty occur approximately every two weeks. According to Satoshi’s original design, these tweaks aim to maintain a consistent block time of around 10 minutes.

If miners are processing blocks faster than the 10-minute average, the chain’s Difficulty level increases. Conversely, if they take longer, the Difficulty is reduced to help them get back on track.

The speed at which miners operate, referred to as Hashrate, directly influences their performance. As shown in the chart from Blockchain.com, miners were previously in rapid expansion, leading to four consecutive Difficulty increases.

The Difficulty adjustment has a significant impact on Bitcoin miners: regardless of their investments, they cannot collectively earn more block subsidies than the network permits.

The “block subsidy” refers to the BTC rewards miners gain for adding blocks to the blockchain. This reward constitutes the bulk of a miner’s earnings, with transaction fees adding only a minor fraction.

As Difficulty maintains a 10-minute block completion goal, miners generally receive a consistent amount of rewards daily, irrespective of changes in Hashrate.

This implies that when Hashrate increases, a larger group of miners competes for the same total rewards, which only changes after the subsequent Difficulty adjustment. During the interim, miners may see varied earnings.

Thus, miners who don’t scale their operations in line with the global Hashrate may earn less, as total BTC rewards remain limited.

Those facing revenue reductions after a Difficulty rise might find themselves forced to leave the network. The Hashrate chart indicates a significant dip during late April, likely due to a substantial Difficulty increase.

Now that Difficulty is finally decreasing from the previous Hashrate decline, miners may feel motivated to expand their operations again. Recent trends in the 7-day average of Hashrate suggest this shift is already underway.

BTC Price Update

In recent days, Bitcoin’s recovery has stalled, and its price has dropped to approximately $93,900.