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What is Bitcoin Mining Difficulty?<\/h2>\n
Essentially, Satoshi Nakamoto designed Bitcoin to produce (mine) a new block every 10 minutes. Though, the amount of computing power has an effect on this procedure. For example, if a group of new miners commences mining, the computing power rises and this would initially proceed to mine blocks faster.<\/p>\n
However, to avoid such scenarios from happening, the pseudonymous Satoshi Nakamoto set Bitcoin to automatically adjust its difficulty in a period of every 2016 blocks which equals approximately 2 weeks. Thus, if within these two weeks, Bitcoin’s computing power increases, the software will increase Bitcoin mining difficulty to prevent blocks from being produced faster than 10 minutes.<\/p>\n
Here is how Satoshi Nakamoto describes this in the Bitcoin whitepaper:<\/p>\n
\u201cTo compensate for increasing hardware speed and varying interest in running nodes over time, the proof-of-work difficulty is determined by a moving average targeting an average number of blocks per hour. If they\u2019re generated too fast, the difficulty increases.\u201d<\/em><\/p>\n The next mining difficulty adjustment comes on July 3. And since the computing power dedicated to Bitcoin has reduced substantially, numerous sources estimate the mining difficulty to plunge by more than 25% \u2014 which makes this the biggest difficulty drop in Bitcoin’s history.<\/p>\n In addition, Bitcoin’s mining difficulty has been in decline for the last two months. On May 30, Bitcoin’s mining difficulty dropped by about 16%, and on June 14, it plunged by around 5%. <\/p>\n Nevertheless, a decline in mining difficulty generally implies a rise in mining profitability. Thus, with this historic drop in mining difficulty, new hordes of investors might find Bitcoin mining profitable and commence mining.<\/p>\nBitcoin Mining Difficulty Poised to Plunge 21%<\/h2>\n