Bitcoin Network Difficulty Reduces as Has Rate Tends to Recover

Jamal Molla
Written By Jamal Molla
I write about cryptocurrency, with a special interest in NFT and metaverse in particular.

A block of Bitcoin network difficulty has reduced recently to 27.693 trillion as the difficulty reduction continues in the third month since May 2022 when it reached an all-time high of over 31 trillion.

Network difficulty refers to the method of ensuring the legitimacy of all transactions conducted on the Bitcoin platform through raw computing power. Created by Satoshi Nakamoto, the legendary Bitcoin creator, the reduced difficulty makes it easier for Bitcoin miners to use lower resources to confirm transactions. It also enables smaller miners to have a good shot at earning mining rewards.

The minor setback notwithstanding, data from blockchain.com reveals that Bitcoin still maintains its position as the most immutable and resilient blockchain network. Although the difficulty adjustment corresponds to miners’ hashing power, the total has rate (TH/s) recorded a recovery rate of 3.2% within the same timeframe.

Bitcoin has rate reached 231.428 exahash per second (EH/s) at its peak in June when BTC price dropped to $25,000. Reaching an all-time high raised some concerns about the volume of power usage.

Over a year ago, the Chinese government banned all cryptocurrency mining and trading operations across the country in June 2021. Leveraging the ban, the United States overthrew China as the leading Bitcoin hash rate contributor.

In September of the same year, Chinese miners took up their tools and resumed operations. Today, China contributes 21.11% to the global Bitcoin hash rate while the US and Kazakhstan contribute 37.84% and 13.22% respectively, as reported by Statista.

In a previous report, Cointelegraph noted that small-time miners are taking advantage of the drop in GPU prices to procure more efficient and powerful mining equipment. They also see the ongoing bear market as an opportunity to offset their operational costs.

In another study on exorbitant power usage, the Bitcoin Mining Council reported that electricity from sustainable sources provides approximately 60% of the power for BTC mining.

In a tweet, Michael Saylor explained that “In Q2 2022, #Bitcoin mining efficiency surged 46% YoY, and sustainable power mix reached 59.5%, above 50% for the 5th quarter in a row. The network was 137% more secure YoY, only using 63% more energy. It is hard to find an industry more clean & efficient.”

The study reported further that only 0.09% of the approximately 35 billion metric tons of carbon emission produced globally was from BTC mining and it consumes a mere 0.15% of the entire global energy supply.

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