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Mining is essential for the operation of Bitcoin and many other cryptocurrencies for blockchain validations and for the generation of available resources. Bitcoin hashing difficulty is routinely adjusted every two weeks, ensuring that the 10-minute blocking time remains consistent. In a recent BTC.com report, it appears that Bitcoin's mining difficulty recorded the biggest drop in its life, with a -15% adjustment.
#Bitcoin has just had its second biggest decline in mining difficulties in history: -15.1%. This is the current ranking:
2011-Nov-01: -18.0%
2018-dec-03: -15.1%
2011-Oct-16: -13.1%
2012-dec-27: -11.6%
2011-mar-26: -9.5%
2013-Jan-26: -8.6%
2011-dec-01: -8.5%
2012 May 25: -9.2%– Fernando Ulrich (@fernandoulrich) 3 December 2018
Mining hardware seems to improve in the encrypted world, while smaller companies decide to vanish, which could be the reason for the drastic reduction of mining difficulties. The last time this type of drop happened for Bitcoin came back on October 31stst, 2011, when it suffered a decline of 18.03%, followed by a 13.09%.
Although this sounds like a problem, it could help the mining efforts that have been suspended for the truce in the midst of their greatest losses. Users with more powerful and efficient computers could even create greater competitiveness with their hashrate simply by switching on their ASICs.
Atulya Sarin, a professor at the Leavy School of Business, recently wrote a piece of opinion for MarketWatch, arguing that the decline in mining profitability is a bad sign for Bitcoin's ability to maintain its value. He commented that most miners do not give priority to register security, but instead it is
"Good weather miners are looking for a quick pay that could quickly disappear once the opportunity dissolves."
Sarin continues, writing,
"Mining at a cost higher than the cost at which it is possible to sell in the futures market destroys value, so any rational investor […] has no incentive for mining if the cost of mining is higher than the future price and it is better to buy on the futures market … Absent mining, Bitcoin is just a set of worthless encrypted numbers. "
CEO Shixing Mao of the F2Pool encryption pool presented some important data on the profitability of mining activities in this scenario. The break-even point, according to Mao, is between $ 3,891 and $ 11,581, which may vary with the equipment available. When it originally predicted this information, Bitcoin was still above $ 6,000.
Currently, Bitcoin is trading at $ 3,868.15 after a loss of 3.61% in the last 24 hours. Although Bitcoin managed to hold a place over the weekend at over $ 4,000, today they have declined.
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