Bitcoin mining has never been more competitive, even though BTC loses 13% in August
Data from chain monitoring resource BTC.com confirms that on August 31, Bitcoin’s network difficulty reached new records.
Bitcoin seals biggest difficulty jump since start of 2022
Despite the recent declines in BTC prices, Bitcoin’s network fundamentals tell an optimistic story as August draws to a close.
Both difficulty and hash rate are rising, reflecting conviction among miners about the long-term profitability of their network participation. It also suggests that the mining sector is absorbing lower profits versus costs in the short term.
The difficulty level, which increased by 9.26% at the automatic switch on August 31st, is now at its highest ever. The competition among miners is as healthy as ever.
In comparison, the last time difficulty increased more than once was in January (9.32%), and before that in August 2021 (13.24%).
According to BTC.com, the hash rate is now averaging 221 exahashes per second (EH/s), a hair from the highest ever recorded average reading of 223 EH/s from just before May’s Terra LUNA implosion.
Fundamentals for Bitcoin (BTC) have made a “welcome rally” that research says is taking the edge off a classic bear market.
“Personally, I think that as more hashrate comes from the US, we will see a new annual seasonal trend like we used to see in China. ie warm months lower hashrate/help stabilize net, cool months higher hashrate,” macroanalyst Jason Deane wrote in part of a Twitter response to the difficulty level.
Bitcoin “barely keeping up”
The figures provide a welcome counterpoint to troubled spot markets and gloomy forecasts for the rest of 2022.
Related: BTC Price Peak Alerts Appear As 10K BTC Leaves Wallet After 9 Years
With BTC/USD down almost 13% through the end of August, chain research firm Glassnode said a decline in fundamentals would be a useful antidote to an otherwise sour environment.
“Bitcoin is still likely to be in bottom formation territory and will be historically similar to all previous bear markets,” concluded the latest edition of the regular newsletter, “The Week On-Chain”, published on August 30 with the title “Bitcoin is barely hanging on on.”
“But Bitcoin prices are only just hanging on, and any uptick in fundamentals will be a welcome change.”
BTC/USD circled $20,150 at the time of writing, after recovering from levels below $20,000 overnight, according to data from Cointelegraph Markets Pro and TradingView.
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