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The Difficulty of Mining Bitcoin Increases, Extending the Recovery Following China's Crackdown

The mining difficulty of bitcoin - a measure of the amount of processing power needed to mine bitcoin – has risen for the third time in a row, indicating the network's resilience after a crackdown on the sector by Chinese authorities earlier this year.

The Bitcoin blockchain's built-in self-stabilizing features rely heavily on mining difficulty. Blocks are found or mined more rapidly when there are more crypto miners on the network. Miners are discovered less often when they drop off the network. To compensate, the blockchain's code changes itself on a regular basis to guarantee that data blocks are mined every 10 minutes or so. When the Bitcoin blockchain was first established over a decade ago, this procedure was hard-coded into the network's initial design.

According to various mining sites, the blockchain's mining difficulty rose by 13.2 percent at block 697,536 at 14:41 UTC on Wednesday.

The current rise in bitcoin mining difficulty comes as some operators re-enter the network after previously leaving due to China's restrictions, and as North American miners boost capacity.

The Bitcoin mining difficulty resets every two weeks and is an important indicator of the network's health as well as a deciding element in miners' profit margins.

Bitcoin's difficulty level dropped to its lowest point in history on July 3 as bitcoin's hashrate, a measure of the overall computing power utilized to protect the blockchain network, reached a low point a few months ago.

According to Arcane Research, the 14-day moving average of bitcoin hashrate has recovered approximately 25% from its low point in late June. According to Glassnode statistics, the figure was 123 exahashes per second on Tuesday. A quadrillion calculations are represented by an exahash.

Despite the fact that Bitcoin mining difficulty has been rising, industry insiders believe it is still a favorable moment for miners.

“Bitcoin mining has never been more profitable,” said Dave Perrill, CEO of Compute North, a crypto mining colocation firm. “Take a look at the % price rise in bitcoin over the past 12 months and compare it to the percentage increase in hashrate, and you'll see that it's nowhere near in line.”

As of press time, Bitcoin was trading at $48,899, up 1.86 percent in the previous 24 hours.

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