Bitcoin mining difficulty rises to a new record high amid a severe shortage of mining equipment
Bitcoin mining difficulty rose and reached almost an all-time high for the first time in three months when Bitcoin's rally began at the end of October 2020.
📈 #Bitcoin $BTC Mining Difficulty just reached an ATH of 89,436,385,276,966,192,807,936
— glassnode alerts (@glassnodealerts) January 23, 2021
View metric:https://t.co/uH8dpKhxJ7 pic.twitter.com/9kBNN5xHRN
The low bitcoin mining difficulty throughout the uphill period indicates that there is less pressure on the miners.
The difficulty in mining low levels allowed the miners to gain some profits due to higher prices and lower mining difficulty.
Another factor that has contributed to reducing mining difficulty in the recent past is the shortage of mining chips in the market.
China accounts for more than 60% of Bitcoin mining, and according to recently published reports, there is a huge shortage of new mining chips due to the Coronavirus.
This also led to an increase in the price of bitcoin mining devices in the flea market.
Li Tong, Managing Director of Financial Services at "Babel Finance", explained what is happening in the Bitcoin mining market, explaining by saying:
All major miners roam the market in search of mining platforms, willing to pay high prices for used machines.Buying volumes from North America were huge, reducing supply in China.
With mining difficulty rising, does the price of Bitcoin suffer?
Bitcoin mining difficulty is a major indicator of the competition between the two miners.
In the wake of the Bitcoin mining bonus split event that occurred last year, many miners were concerned that they might have to abandon mining because the bitcoin price was hovering around $ 13,000, making the profit potential.
However, in a short time, bitcoin began to rise, and the mining difficulty eased, making the possibility of mining with old mining hardware profitable and thus calming the competition.
Over the past three weeks, Bitcoin has seen a break in its three-month bullish momentum with price corrections of more than 10%, driving bitcoin's price down below $ 30,000 for a short period.
Bitcoin is currently trying to recover the $ 33,000 price level.
With mining difficulty reaching an all-new high, the bitcoin price that hasn't seen much price action for the past two weeks may prepare for another rally.