Bitcoin’s mining difficulty registers its fifth negative adjustment in 2022
According to data provided by BTC.com, bitcoin’s mining difficulty has dropped by 2.35% over the past two weeks, marking the second-largest downside adjustment since the start of 2022.
The mining difficulty is updated approximately every two weeks to accommodate the speed of block production.
Overall, bitcoin has now registered a total of five negative adjustments this year.
Mining difficulty decreases dramatically during major market downturns. Miners, who can no longer make a profit or even break even, are forced to shut down their equipment. For example, the mining difficulty of bitcoin fell by more than 15% during the mass exodus of miners during the coldest days of the 2018 crypto winter.
Last June, bitcoin’s mining difficulty fell by 27.9% within two weeks, the biggest drop in history since the cryptocurrency’s hash rate collapsed due to China’s mining ban.However, the metric managed to recover and hit a new all-time high in January. In early May, bitcoin’s mining difficulty peaked at $31.25 trillion at the peak of a significant market correction.
Bitcoin is currently trading at just $20,400, having lost more than 55% of its value since the start of the year.
According to information Provided by Arcane Research, bitcoin mining firms sold all coins produced in May, reflecting their bearish sentiment.
Miners remain among the most influential market participants due to their vast holdings. Hence, many fear that they may extend the current sell-off.
