Bitcoin BTC/USD mining difficulty hit an all-time high early on Wednesday despite the asset’s price seeing a sharp decline to $20,309 at the time of writing.
What Happened: On-chain data from BTC.com shows that mining difficulty on the Bitcoin network soared to a new high of 32.05 trillion.
Meanwhile, the average hashrate on the network was around 228.24 EH/s – a significantly high number despite being down from an all-time high of 231 EH/s.
The high levels of hashrate and mining difficulty are useful indicators to examine the current state of the Bitcoin network.
Difficulty is the measure that increases or decreases with the amount of hashrate on the Bitcoin network at any given point in time. The difficulty adjustment takes place to make mining BTC easier when hashrate is lower than required, and increases to make mining BTC harder when there is a large amount of hashrate.
In this scenario, the network indicators show that a large number of participants are still mining BTC despite the asset’s decline in price, implying that mining may still be profitable for a number of BTC miners.
See Also: IS BITCOIN A GOOD INVESTMENT?
Price Action: At press time, BTC was trading at $20,309, down 6.9% over the last 24 hours, as per data from Benzinga Pro.
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