Bitcoin Mining Difficulty Plunges 7.5% — Largest Drop Since China 2021 Ban

Bitcoin mining difficulty dropped 7.5% — the largest adjustment in nearly four years. Summer curtailments and a weakened hashrate signal a shifting mining landscape.

Bitcoin mining difficulty has experienced its sharpest decline since mid-2021, dropping by 7.5% in a rare negative adjustment. The drop occurred on block height 903,168, with the difficulty level falling from 126.41 trillion to 116.96 trillion, according to Mempool data.

Difficulty, a measure of how hard it is to discover a new block, is automatically recalibrated every 2,016 blocks — approximately every two weeks — to ensure a consistent rate of block production. Despite the algorithm’s aim to keep block generation near the 10-minute mark, blocks were being mined at 10 minutes and 38 seconds on average before this latest adjustment, according to Clark Moody’s dashboard.

The adjustment helps balance the network. When fewer miners are competing to find blocks, the protocol lowers the difficulty. Conversely, when more miners enter the network, difficulty increases. This mechanism maintains Bitcoin’s predictable issuance rate — regardless of external disruptions.

Biggest Drop Since 2021’s Mining Exodus from China

This 7.5% drop marks the largest downward adjustment since July 2021, when China imposed a sweeping ban on crypto mining. That crackdown triggered a 28% difficulty drop and sent Bitcoin plunging from $60,000 to $34,000. The current decline even surpasses the 7% drop in December 2022, which occurred during a deep crypto winter.

Today, Bitcoin is trading at approximately $107,680, reflecting a stark contrast to the 2021 bear cycle.

China’s mining ban, citing energy consumption, environmental impact, and financial risk, led to a global hashrate shift as miners relocated to Kazakhstan, Russia, and especially the United States — with Texas emerging as a top destination.

Texas Heat and U.S. Curtailment Behind the Hashrate Drop

This week’s drop in difficulty appears to be influenced by summer energy curtailments across U.S. mining regions, particularly Texas. Grid operators have encouraged miners to pause operations during peak demand periods — offering lucrative energy credits in return. These voluntary shutdowns help stabilize the grid but temporarily reduce Bitcoin’s network hashrate.

Ahead of Sunday’s adjustment, the total network hashrate dropped from 902 EH/s to 838 EH/s. As a result, miners remaining on the network began producing blocks faster — at an average of 8 minutes and 24 seconds — potentially setting the stage for a sharp upward difficulty adjustment if hashrate rebounds quickly.

Temporary Relief for Active Miners as Hashprice Spikes

Following the adjustment, hashprice — a metric developed by Luxor to indicate the expected revenue per terahash per day — jumped back toward $60 per PH/s/day or $0.05 per TH/s/day. This brief boost offers relief to miners still online, who now earn more for their computing power.

However, this advantage may be short-lived. As idle machines reactivate and join the network, increased competition will likely push hashprice back down, continuing its overall downward trend.

Hashprice is a crucial benchmark for miners. It reflects how much a specific amount of computing power can earn in a single day, taking into account network difficulty, block rewards, and transaction fees.

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