• Bitcoin mining difficulty recorded a sharp drop of 3.6% in the early hours of Tuesday.
• This took the mining difficulty from 35.36T to 34.09T following the adjustment.
• The lower mining difficulty means there are fewer miners on the network.
The bitcoin mining difficulty saw a significant drop on Tuesday morning during Asia hours. According to data from CoinWarz, the mining difficulty fell almost 3.6% in a sharp downward correction. This adjustment took the mining difficulty from 35.36T to 34.09T.
The mining difficulty of Bitcoin is an important metric as it measures how much power is needed to verify transaction blocks on the network. The higher the figure is, the more demand it shows for the Bitcoin network. On the other hand, a lower mining difficulty means there are fewer miners on the network.
The recent drop in mining difficulty could be due to the blizzard that swept through the United States in January 2021. The extreme cold temperatures forced miners to disconnect their machines in an effort to free up the energy grid and provide enough power to citizens for their homes.
The effects of the mining difficulty on the price of Bitcoin have yet to be seen. Despite the sharp downward correction, the digital asset is still stagnating in the mid-16,000s. It remains to be seen whether the lower mining difficulty will have any long-term impacts on the price of Bitcoin. Only time will tell.