Bitcoin’s mining difficulty has recently reached a historic peak, surging by 6.47% to an impressive 61.03 trillion hashes per block. Several factors are contributing to this significant increase, including the imminent Bitcoin halving event, potential fluctuations in energy costs, and the global uncertainties that continue to impact both the value of Bitcoin and the profitability of miners.
Miners are currently intensifying their efforts as they brace for the impending halving event, which will reduce block payouts from 6.25 to 3.125 BTC. However, the consolidation of power within larger mining operations has raised concerns about network centralization. To counteract this trend, miners are increasingly forming pools to collaborate and share resources and profits.
In response to these challenges, miners are strategically maximizing their returns in anticipation of the halving event. They are achieving this by investing in energy-efficient hardware, such as Application-Specific Integrated Circuits (ASICs), and optimizing their energy consumption. Nonetheless, the heightened mining difficulty could potentially exacerbate the centralization of the Bitcoin network, sparking debates concerning its foundational principles of decentralization.
On Friday, Bitcoin’s mining hashrate reached an all-time high of 543 exahashes per second (EH/s), underscoring a secure network environment leading up to the April 2024 halving event. Data from CoinMarketCap indicates that Bitcoin is trading at over $34,000, boasting a week-on-week increase of 12% and a year-to-date gain that exceeds 100%.
The bullish sentiment surrounding Bitcoin is closely tied to the potential approval of a spot Bitcoin Exchange-Traded Fund (ETF) by the United States Securities and Exchange Commission (SEC). Renowned financial analyst CryptoCon shared a bullish prediction on Twitter, forecasting that Bitcoin could reach $45,000 in November.
Despite Bitcoin’s current price trading approximately 50% below its all-time high, data from Glassnode reveals that 80% of Bitcoin addresses are now profitable at the $34,000 level. A record-breaking 39.1 million Bitcoin addresses were in a state of profit on Saturday, surpassing the previous peak of 38.1 million recorded in November 2021. This remarkable achievement comes despite the FTX meltdown in December 2022, which caused significant losses for over 20 million addresses. Moreover, the total number of non-zero balance Bitcoin addresses has now surged to 48.3 million, signaling a growing interest and active participation within the Bitcoin network.
